PRESS RELEASE
November 27, 2007
ARLINGTON, Va. — NASCUS provided comments in a November 21 letter on the importance of dual chartering in the U.S Treasury’s review of the regulatory structure associated with financial institutions.
The comment letter is in response to U.S. Treasury’s request for input on a blueprint for an improved U.S. financial regulatory structure. The blueprint is part of U.S. Treasury Secretary Henry M. Paulson’s goal to strengthen U.S. financial markets' ability to compete in the global economy.
NASCUS emphasizes that today’s regulatory system is strengthened by dual chartering which provides for diversity, innovation and healthy competition. NASCUS encourages the U.S Treasury to continue dual chartering in any regulatory structure it develops for the future.
“The dual chartering system has successfully functioned for more than 140 years,” NASCUS wrote. “Dual chartering has remained viable in the financial marketplace because of the distinct benefits provided by each charter.” Further, NASCUS stated that a key feature of the dual chartering system is that individual institutions can select the charter that will benefit their members or consumers the most.
Dual chartering also benefits regulators, NASCUS explains. “Charter choice creates healthy competition and provides an incentive for regulators (both state and federal) to maximize efficiency in their examinations and reduce costs. It also allows regulators to take innovative approaches to regulation while maintaining high standards for safety and soundness.”
NASCUS also highlighted the strengths of the state charter to individual states and their citizens. “State-chartered credit unions have made many contributions to the economic vitality of consumers in individual states,” said NASCUS. “Many consumer protection programs were designed by state legislators and regulators to recognize choice and innovation; these protections may not have been recognized in a more simplified regulatory structure.”
In closing, NASCUS believes that any regulatory structure considered by the U.S. Treasury should allow for the continuation of the dual chartering system. It is critical that the benefits of the state system are recognized in the nation’s regulatory structure and that new policies do not limit state regulatory authority and innovation.
To view the NASCUS comment letter, click here.
Information
Contact:
Kate Hartig, Director, Communications and Public Affairs,
(703) 528-0669 or kate@nascus.org
The
NASCUS mission is to enhance state credit union
supervision and advocate a safe and sound state
credit union system. Founded in 1965, NASCUS
represents all 48 state and territorial credit
union supervisors and the NASCUS Credit Union
Advisory Council, which is made up of nearly
500 of the nation's more than 3,400 state-chartered
credit unions.
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