National Credit Union Administration Chairman Debbie Matz will appear before the House Financial Services Subcommittee on Financial Institutions and Consumer Credit tomorrow — her first appearance before Congress since 2011 — and ABA urged House members to hold NCUA accountable for its efforts to subvert congressional intent.
“Once called a ‘rogue federal agency’ by a federal judge, over the past month it has become obvious that NCUA has again become a cheerleader for the $1 trillion industry it is charged with supervising,” ABA said. The association pointed out that NCUA is working to expand credit union fields of membership, make preferential capital rules for CUs and expand an overbroad “low-income” designation.
Most outrageous, ABA said, is NCUA’s recent proposal to expand credit union business lending. “The agency’s new proposed rule on business lending is a stunning snub to Congress,” ABA wrote, noting that the 12.25 percent cap on MBL assets is a longstanding deliberate choice by Congress. “Acting with willful blindness to Congressional intent, NCUA now claims 12.25 percent is ‘shorthand’ for the cap, and that the agency can raise it on its own,” ABA continued.
ABA noted that NCUA’s proposal would make the MBL cap “irrelevant” through a massive loan syndication program. “NCUA has not established that it is prepared to supervise institutions with a dramatically expanded business loan portfolio,” ABA said, warning that taxpayers and credit union members are put at risk by NCUA’s “demonstrated poor track record” of supervision.
