NAFCU hears credit unions need ways to reach new members and has worked with the NCUA on its proposed rule on field of membership. Last November, the NCUA board proposed a rule that would revamp federal credit union chartering and FOM rules. NAFCU is fighting to have as much as this regulatory proposal finalized as soon as possible this year.

Just a few months ago, the NCUA board finalized a rule eliminating the member business lending waiver process and allowing credit unions to decide if a borrower should be exempt from a personal guarantee. The NCUA heeded NAFCU's suggestion to expedite the effective date to 12 months after the rule's finalization, adopting an implementation date of Jan. 1, 2017. Additionally, the NCUA adopted a transitional provision that allowed credit unions to grant an MBL without a personal guarantee beginning May 13, 2016. These changes reduce regulation and allow credit unions to make business decisions for themselves.

Credit unions are also telling us they need relief from the 12-month exam cycle. In May, we welcomed NCUA Board Chairman Rick Metsger's announcement that in the next two months, the NCUA intends to remove the requirement that all federally insured, state chartered credit unions with more than $250 million in assets be examined each calendar year. He also announced the formation of a working group to thoroughly study the examination cycle.

Regulatory Efforts: The CFPB

CFPB Director Richard Cordray has been responsive to concerns over the Truth in Lending Act and Real Estate Settlement Procedures Act integrated disclosures rule. In March, Cordray said the hold-harmless period related to the bureau's TRID rule will remain open ended due to the unforeseen information technology problems. Further, Cordray said the CFPB will try to provide more guidance on the rule and does not expect to take enforcement actions against noncompliance unless there are blatant violations.

Earlier this month, the bureau also issued its long-anticipated proposed rule on payday lending. While the CFPB recognized the NCUA's payday alternative loans program, that's not enough for us. We believe the bureau can do more. We are extremely concerned about the proposal's effect on credit unions' ability to exercise statutory liens. NAFCU had advocated for the preservation of the PAL program through an express exemption for credit unions. We continue discussions with the bureau and are evaluating the proposed rule for its full impact on credit unions.

Other Regulators

The Department of Defense amended its regulation implementing the Military Lending Act final rule. The final rule expanded the definition of consumer credit to cover a broader range of closed-end and open-end credit products. NAFCU continues to advocate for guidance materials to be issued prior to the Oct. 3, 2016 compliance deadline.

In May, the Department of Labor issued its final overtime rule, which goes into effect Dec. 1. NAFCU expressed concern that this rule could have unwarranted impact on credit unions.

In 2012, the Financial Accounting Standards Board put forth its current expected credit loss model for all nongovernmental entities. Recently, FASB voted to delay by one year CECL's effective date for credit unions, as sought by NAFCU, to 2021. The board also voted to make certain disclosure requirements in the CECL standard optional for non-public business entities, which includes credit unions.

Bottom line, NAFCU will continue to go full throttle to help credit unions succeed and promote a positive legislative and regulatory climate where credit unions can thrive. “Bank” is a four-letter word, and we are driven daily to champion the credit union difference!

B. Dan Berger is president/CEO of NAFCU. He can be reached at 703-522-4770 or [email protected].