(March 5, 2021) Staying focused on capital and liquidity, consumer financial protection, and diversity, equity and economic inclusion will achieve a vibrant economic outcome from the impact of the coronavirus crisis for everyone, including credit unions, the NCUA Board chairman said in a speech this week.
In recorded video remarks to the Credit Union Natl. Assn.’s (CUNA) annual Governmental Affairs Conference (GAC) this week, Chairman Todd Harper urged credit unions to pay careful attention to capital, asset quality, earnings and liquidity as they and their members emerge from the crisis. He urged credit unions to mitigate problems when they develop. And, as the pandemic evolves, he said his agency will continue to adjust its supervision and examination program to mitigate potential risks to the National Credit Union Share Insurance Fund (NCUSIF). He made no mention about a premium to be paid to the fund.
Harper also advocated for creation of a dedicated program to supervise for compliance with consumer financial protection and fair lending laws. He indicated that the agency, in 2020 exams, had found “notable shortfalls” in credit union compliance with the Fair Credit Reporting Act (FCRA), the Electronic Funds Transfer Act (EFTA) and the Truth in Lending Act (TILA).
He said creation of a dedicated consumer protection unit at the agency would “better protect consumers’ interests, ensure that the credit union system lives up to its commitment to serve members, and provide a comparable level of consumer protection oversight as federal bank regulators.”
However, he also said the agency would continue to focus on compliance with forbearance provisions of the 2020 Coronavirus Aid, Relief, and Economic Security (CARES) Act to help consumers facing difficulties spawned by the pandemic. “Whether it means reworking an existing loan due to financial stress, or delaying payments, the NCUA will not criticize a credit union’s efforts to provide prudent relief for members when such measures are conducted in a reasonable manner with proper controls and management oversight,” he said.
He told the group that – given the cooperative philosophy of credit unions – that each credit union “has a moral obligation to step up and help minority-owned businesses and communities recover and start anew in the months ahead.” He challenged the viewers to deliver more financial products and services “free of discrimination or unfair practices to people of color and within communities of color,” adding that such efforts will be “vital to ensuring a more equitable economic recovery.”