Murray Assesses Corporate CUs

GREENBELT, Md. — The NCUA should be careful when revamping the corporate credit union system so as not to deprive natural person credit unions of vital services, Mid-Atlantic Corporate Federal Credit Union President/CEO Jay Murray told credit union executives here.“Divesting the system isn’t necessarily helpful. Without the corporates, the bad investments that hurt many credit unions would have still been in the marketplace,” he said at a dinner meeting of the Metropolitan Area Credit Union Management Association on May 11.He conceded that there is much temptation to place greater regulation on corporates but urged regulators to proceed with caution.“There is much concern about systemic risk concerns, especially around payment systems. But the best approach is to let market forces decide because no study has been done that shows definitively what will work,” he said.He added that despite the problems of some corporates, “we don’t think that the core of the system is broken.” Murray said that corporate credit unions faced increased pressure for higher returns and as a result made use of more sophisticated and complicated investment vehicles, but the regulations didn’t keep up with the changes in the industry. He said his credit union, which is based in Middletown, Pa., has a conservative investment strategy and if it hadn’t been for the write-downs triggered by the problems of U.S. Central Federal Credit Union and Western Corporate Federal Credit Union, his credit union would have had one of its best years ever.Murray added when he solicits suggestions from member credit unions, they suggest his credit union keep doing what it’s doing.He answered questions from Credit Union Times Editor-in-Chief Sarah Snell Cooke and from the audience.–[email protected]