WASHINGTON - CUNA President Dan Mica told a Senate panel today that the credit union movement "would prefer some help'' from the government help in the form of loans to help spread out the cost of losses to the NCUSIF caused by the NCUA's decision to place two large corporate credit unions into conservatorship.
The NCUA is expected to make a request to Congress later this week to further increase its line of credit with the Treasury Department.
In testimony at a Senate Banking Committee hearing on regulatory restructuring, Mica also said the problems of U.S. Central Federal Corporate Credit Union and Western Federal Corporate Credit Union say nothing "about the condition or operation of credit unions that you and I can join." These credit unions have "very narrow investment powers and very conservative investment policies,'' he added.
Mica also said any restructuring of the regulatory system should keep the NCUA as a separate entity because if it were merged into the same regulator as the one that oversees banks "the views, attitudes, and philosophy of the not-for-profit cooperative sector would undoubtedly be swamped and credit union behavior would almost certainly 'morph' into behaviors similar to those found in the for-profit sector.''
In a written statement submitted to the committee, NAFCU Senior Vice President Dan Berger also stressed the positive results of keeping NCUA separate.
"The regulatory structure consisting of an independent regulator in the form of the National Credit Union Association along with an independent insurance fund has served the credit union community well over the last several decades. The stability and direction provided by these unique regulatory mechanisms has helped establish a vibrant, robust credit union industry that will surely play a major role in providing sound financial services to our members and help lift the American economy out of its current malaise,'' he wrote.
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