Nussle Asks Harper to Allow Votes on Final Rules the New Chairman Opposes
In a letter to Harper late last week, CUNA President/CEO Jim Nussle asks the NCUA to take up a list of proposed rules.
CUNA has asked new NCUA Chairman Todd Harper to bring several proposed rules to the agency board for votes, even though he has said he opposes them.
“As you know, these proposals were under development for several months but were unable to be included in board agendas until later in the calendar year,” CUNA President/CEO Jim Nussle wrote in a letter to Harper late last week. “Moving forward, we support the NCUA board’s expeditious review of all pending issues.”
Nussle did not elaborate on why the items were unable to be brought before the board until late in the year. During part of the year, the NCUA board was divided, as then-Board Member J. Mark McWatters, a Republican, and Harper opposed proposals by Chairman Rodney Hood, a Republican. Sources have said that Hood went to the White House and forced McWatters off the board. Following the confirmation of Republican Kyle Hauptman, the NCUA board considered a long list of proposals in December and January.
Harper opposed several of those proposals, which were passed with Hood and Hauptman supporting them.
The future of those proposals remained unclear, following Harper’s ascension to the chairmanship.
In his letter, Nussle cited several of the proposed rules CUNA would like the NCUA board to finalize, including rules that:
- Allow CUSOs to originate any type of loan that federal credit unions may offer. Harper opposed that rule, saying there was no economic basis for it.
- Permit federal credit unions to purchase mortgage servicing rights from other federal credit unions. Harper said that expansion poses risks to the credit union system.
- Include any shared branch, shared ATM or shared electronic facility in the definition of “service facility” for a Multiple Common Bond federal credit union that participates in a shared branching network. Harper said federal law does not allow that change.
- Change the definition of complex credit union — increasing the threshold to $500 million. Harper has said the proposal is ill-timed since it would lower capital standards during an economic crisis.
- Change the 45-day limit within which a member must rectify an overdraft to a more flexible approach. Harper said credit union members need additional overdraft relief during the pandemic.
- Add “sensitivity to market risk” to the CAMEL rating system. Harper voted in favor of that proposed rule.
Nussle also added that the NCUA should adopt a rule that would allow credit unions to use their asset data as of Dec. 31, 2019 for regulatory purposes.
“Due to the COVID-19 pandemic and balance sheet growth as a result of new COVID-related policies, there are credit unions that could be subject to additional regulatory or reporting requirements in 2021 because they are temporarily pushed over an asset-size threshold for compliance,” Nussle wrote. He noted that banking regulators already have adopted such a rule change.