July 16, 2012

Monitor: Reg burden still top concern for CUs

July 17, 2012 – Credit unions continue to face an array of challenges, but the most pressing concern remains the ever-expanding regulatory burden, according to data in the July edition of NAFCU's Economic and CU Issues Monitor.

Released Monday, the July Monitor marks an enhancement from previous editions of the publication – NAFCU has tweaked the format so it's easier to find and understand information. With that goal in mind, the publication now features more charts and graphs.

The July Monitor provides specific data about how the current regulatory environment is impacting NAFCU members. Among the findings:

  • The Credit CARD Act requires an average of 207 hours per year from credit union compliance departments.
  • Mortgage disclosure requirements end up costing roughly 58.7 staff hours on a monthly basis.
  • More than two-thirds (68.4 percent) of the survey respondents said raising the member business lending cap is an important goal for the credit union industry.
  • Capital requirements are a chief concern among credit unions, with nearly half of the survey respondents saying NCUA should support changes to these.
  • Half of the survey respondents said they would raise secondary capital through the sale of uninsured shares if credit unions were allowed to do so.
  • If NCUA were to increase capital standards, 45.9 percent of respondents stated that their credit union would have difficulty complying.

The findings reinforce comments NAFCU has made repeatedly about the current regulatory regime and its impact on credit unions. In a recent letter to Treasury Secretary Timothy Geithner, NAFCU President and CEO Fred Becker noted the need for better coordination among federal financial institution regulators to slow the growth of regulatory burden for credit unions.

The Monitor also indicates that the current environment has resulted in credit unions becoming more efficient. Improved operational efficiency was the most common response by credit unions (24.2 percent) asked about their most important accomplishment last year.

For more, view the July Economic and CU Issues Monitor.