Newsroom

NAFCU President and CEO Dan Berger, thanking Treasury Department staff for hosting a credit union roundtable discussion earlier this month, on Friday offered more details on ways the current administration could ease the credit union industry's regulatory burden.

Berger told Treasury staff that his letter was offered as a "framework" as the department prepares a final report pursuant to President Donald Trump's executive order, "Core Principles for Regulating the United States Financial System."

In his letter, Berger noted the need to ease the regulatory burden on the more than "106 million Americans that own and use this country's nearly 6,000 credit unions."

When discussing credit unions' capital, he noted the "substantively flawed provisions" within the NCUA's risk-based capital rule, including "improper risk-weighting of mortgage servicing rights" and loans and investments to credit union service organizations, among other things. He listed some legislative improvements to capital treatment that would benefit the industry, such as allowing credit unions to have access to supplemental capital sources.

Berger also discussed the barriers credit unions face when lending to their members and shared concerns about the CFPB's ability-to-repay, qualified mortgage and Home Mortgage Disclosure Act rules. He also touched on the bureau's exercise of its unfair, deceptive, or abusive acts and practices authority and how credit unions "are left to make guesses based on CFPB's enforcement actions."

The NAFCU president also touched on commercial lending and credit unions' restrictions in offering member business loans, and he noted various legislative solutions that could provide the industry with more flexibility in this area.

In the letter, Berger also highlighted credit unions' issues with:

• regulatory overlap and duplication;
• regulatory call reports;
• supervisory examination processes;
• Bank Secrecy Act and anti-money laundering regulations;
• costs of compliance;
• regulatory treatment for the current expected credit loss accounting standard; and
• cost-benefit analysis of regulations.