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NCUA's Larry Fazio on Thursday told a House Financial Services subcommittee about the agency's support of regulatory relief bills addressing supplemental capital and member business lending, the agency board's plan to finalize a rule on associational common bond and more.

Fazio, NCUA' director of examination and insurance, was testifying before the House Financial Services Subcommittee on Financial Institutions and Consumer Credit on regulatory burden from the regulators' perspective.

Discussing associational common bond, Fazio said the agency was preparing for board action next week that would add 12 groups to the list of those automatically qualified for inclusion in a federal credit union's field of membership. That's up from the seven proposed last year. NAFCU supported the automatic inclusion aspect of the 2014 proposal but had serious concerns about its threshold determination measures.

NAFCU supports efforts to make field of membership rules more flexible for credit unions and will review the final rule, presuming it is issued next week, for its members.

In his testimony, Fazio noted NCUA's support for three bipartisan regulatory relief bills thare are also supported by NAFCU:

• H.R. 989, from Reps. Peter King, R-N.Y., and Brad Sherman, D-Calif., which would allow federal credit unions to receive payments on eligible uninsured, non-share capital accounts;
• H.R. 1188, from Reps. Ed Royce, R-Calif., and Gregory Meeks, D-N.Y., which would raise the member business lending cap to 27.5 percent of assets for eligible institutions; and
• H.R. 1422, from Reps. Royce and Jared Huffman, D-Calif., which would exempt loans to purchase non-owner-occupied, one-to-four-unit dwellings from the member business lending cap.

In his opening statement, Chairman Randy Neugebauer, R-Texas, noted that NCUA's proposed risk-based capital rule "could result in considerable cost" for credit unions. Also on Thursday, NAFCU submitted its comment letter to NCUA on the proposed rule, detailing its concerns about the rule's cost to the industry and its problematic definition of a "complex" credit union.

During his testimony, Fazio also reiterated the agency's push for third-party vendor examination authority. Rep. Brad Sherman, D-Calif., stated NCUA has not adequately shown any instance where lack of such authority has been an issue and noted that the Federal Financial Institutions Examination Council already regulates third party vendors. Sherman asked that the agency not duplicate the regulatory efforts of another agency.

NAFCU continues to strongly oppose such authority as costly and unnecessary and will continue to weigh in with lawmakers to urge against it.