How NASCUS Advances the State System

A special message from Mary Martha Fortney, President and CEO
December 2012

One of the values of NASCUS is that we are the only organization exclusively dedicated to defending and advancing a strong state credit union system. As 2012 draws to a close, I want to touch base with you about some of NASCUS' work this year on behalf of state credit unions and state regulators reflect that value statement.

NASCUS endeavors everyday to advance the quality and effectiveness of regulation and supervision of state-chartered credit unions and to preserve and protect state authority in the oversight of state credit unions. We understand that a strong, autonomous, and responsive state credit union system is essential for the future viability of the entire credit union movement.

In 2012 NASCUS filed numerous comment letters to make NCUA focus on finding the proper balance in its regulation. We opposed NCUA proposed rules regarding loan participations and CUSOs as disproportionate responses to legitimate concerns. We urged NCUA to reconsider an overly specific liquidity proposal and fought for greater flexibility with the interest rate rule. NASCUS' efforts have contributed to inducing NCUA to reconsider aspects of the proposed CUSO and loan participation rulemaking. We hope for a similar outcome on the troubled condition definition rule.

NASCUS is also working to bring parity to state low income credit unions. We have been working with the NCUA's Office of Consumer Protection (OCP) to facilitate the identification and designation of federally insured state-chartered credit unions (FISCUs) that would qualify as low income credit unions (LICUs) under NCUA's rules. As you know, an NCUA LICU designation provides certain regulatory benefits including the ability to accept supplemental capital and an exemption from the member business lending cap under certain circumstances. Our expectation is that this will happen on early 2013. We will continue to work to bring parity to state credit unions in this regard.

We have seen success in Supplemental Capital this year as well. For over a decade in testimony before Congress and presentations around the credit union system, NASCUS recommended access to supplemental capital for natural person credit unions. It wasn't until recently that consensus was reached resulting in the introduction of federal legislation this year (H.R. 3993) to allow natural person credit unions to access supplemental capital. This was a significant step toward achieving this critical reform for credit unions. NASCUS will continue to push for this important priority in the 2013.

And there is so much more.

We summarized all of NCUA's guidance, legal opinions, and letters to credit unions with an eye to how they impact state charters. We worked with state leagues and associations to coordinate messages about the importance of the state system, and served as a ready resource for the initiatives before your state legislatures to provide the regulator's justification for effective state laws.

Of course, we have also stepped up the number, and diversity, of our training for both examiners and credit union staff in response to your requests for education.

But most importantly, we continued to serve as the state system's voice this year. Behind the scenes on numerous working groups and committees with NCUA, with the CFPB, FTC, Treasury and Congress, NASCUS delivered the message that despite the scope and depth of the economic downturn, the state credit union system stood strong as guardians of the members' money and worthy of the public trust. And we did this from the unique perspective of a voice of state regulators: not as cheerleaders, but as balanced unbiased professionals. That carries weight and is important.

This is a just a sampling of the work we've done over the past year to advance a strong state system. Count on NASCUS in the coming year. If you have any questions or comments you would like to share, please do not hesitate to email me or call me.

Meanwhile, best wishes for a prosperous and happy 2013!