November 15, 2021

Berger urges Treasury to include credit unions in PWG Stablecoin Report

treasuryNAFCU President and CEO Dan Berger Friday wrote to Treasury Secretary Janet Yellen in response to the exclusion of credit unions from the President’s Working Group on Financial Markets’ (PWG) Report on Stablecoins. Berger addressed that this exclusion risks continuing the uneven regulatory landscape between credit unions and other financial institutions while also placing the NCUA in an untenable position.

"We urge the PWG to clarify that credit unions, as insured depository institutions, have parity with banks with respect to the recommendations made in the Report and ask that all members of the PWG support the NCUA’s inclusion in ongoing and future PWG efforts," wrote Berger.

Berger highlighted that the report recommends that Congress enact legislation requiring all payment stablecoin issuers to be “insured depository institutions” – citing the narrow definition from the Federal Deposit Insurance Act. This definition risks legislators interpreting the report recommending that Congress enact legislation requiring a stablecoin issuer to obtain a bank charter – not either a bank or credit union charter.

"The NCUA protects the financial wellbeing of over 127 million Americans by providing this country’s credit union members with federal share insurance that matches the Federal Deposit Insurance Corporation’s protections dollar for dollar," wrote Berger. "If credit unions are wholly excluded from participating in these and similar innovations, credit unions and their members will be needlessly harmed, and the NCUA will be handicapped in its charge to ensure the safety and soundness of an important, irreplaceable sector of the financial system."

Read the full letter here. The association recently provided feedback to the NCUA in response to a request for information (RFI) on how credit unions use digital assets and what risks such uses pose to credit unions, related entities, and the agency. Of note, NAFCU Regulatory Affairs Counsel Dale Baker last week also reviewed the stablecoin report in a NAFCU Network insight post.