Pennsylvania Regulator Scorns ‘Gotcha’ Exams
The top regulator of banks and credit unions in Pennsylvania is attacking what he calls the “gotcha” practice of surprise exams.
“The businesses and professionals we supervise should know what to expect from us,” wrote Glenn Moyer, Pennsylvania secretary of banking, in the agency’s spring bulletin out this week.
He said the department expects to enhance transparency and reduce uncertainty in the exam process by increasing the level and depth of communications through a new agency unit called Client Financial Services.
He also said the department maintains good relationships with the new federal Consumer Financial Protection Bureau.
“We not only expect that information sharing will work in both directions but we also expect to use our seat at the table in Washington to be able to advocate for Pennsylvania interests,” Moyer said in the state agency’s bulletin.
The regulator’s comments come amid complaints from credit unions about NCUA exam practices. The trades are pushing a House bill, the Financial Institutions Examination Fairness and Reform Act.
Moyer also cited the negative fallout from Dodd-Frank playing out in Pennsylvania in the form of bank conversions to state charters.
“Several federally chartered banking institutions have sought to convert to the state charter,” said Moyer noting that five banking charters converted in 2011, “two converted in the first quarter and several more applications for charter conversions are in process.” No mention was made of potential credit union conversions.
“We employ excellent, dedicated and qualified examiners,” Moyer concluded adding, “several banking leaders have already come to the conclusion that the Department of Banking clearly appreciates the distinctiveness of Pennsylvania and the diversity of business models.”