Newsroom

November 02, 2016

Metsger says NCUA not engaged in 'de-risking' the CU industry

NCUA has not engaged in broad "de-risking" initiatives within the credit union system, nor did the agency participate in the Justice Department's Operation Choke Point initiative, NCUA Board Chairman Rick Metsger wrote in a letter Monday to Sen. Jeff Flake, R-Ariz., and Rep. Blaine Luetkemeyer, R-Mo.

Flake and Luetkemeyer, chairman of the House Financial Services Subcommittee on Housing and Insurance, wrote Metsger last month seeking answers on how the agency has addressed impacts associated with the practice of financial institutions' de-risking, or terminating certain accounts due to potential risks. They asked that the agency clarify its position on the de-risking trend and examine its anti-money laundering regulations.

Metsger noted in his response that the NCUA has "consistently clarified" its position in joint interagency responses, supervisory guidance and internal directives to staff about Bank Secrecy Act issues. "NCUA encourages credit unions to take a risk-based approach in assessing individual customer relationships, rather than declining to provide banking services to entire categories of customers without regard to the risk presented by an individual member or the credit union's ability to manage the risk," Metsger added.

He also pointed to NCUA's supervisory guidance on anti-money laundering in December 2014, and a memorandum sent to all NCUA field staff in August 2014 stating the agency's policy that the decision to open, close or decline a particular account or relationship is generally made by a credit union, without the agency's involvement.

"NCUA will continue to ensure that all of our materials and guidance clearly outline these policies," Metsger concluded. "Moreover, I want to personally assure you that NCUA remains dedicated to ensuring public access to financial services in an environment that promotes trust and confidence."