The North Carolina Credit Union League hasn’t given up on bringing the NCUA and North Carolina Credit Union Division to the bargaining table over issues that led to separate examinations of state chartered credit unions, league board Chairman Maurice Smith said.
State Administrator Jerri Jay’s pilot program that allowed the $25 billion State Employees’ Credit Union to release its state CAMEL rating will not continue beyond one year, and the NCUA has said it will not conduct separate exams if Jay discontinues the program.
However, Smith said a meeting is still necessary because the conflict is “plowing new legal ground as far as what a federal regulator’s reaction should be when state’s policy runs counter to its policy.”
Smith, president/CEO of the $1.2 billion Local Government Federal Credit Union in Raleigh, N.C. and a licensed attorney, said there is no system for reconciling the two conflicting points of view, and unless one is created, another state could soon find itself in the same situation.
He said the league has reached out to both sides, and is waiting for a response.
According to a July 30 email obtained by Credit Union Times, the league is attempting get both sides to agree to a meeting date in mid-August, and Jay has agreed to meet.
Additionally, the league is preparing to appeal to the North Carolina Credit Union Commission, a panel of seven appointed by the governor, asking the group to ratify that what Jay did was within her legal authority.
“We believe what she did was the correct thing, but we want the commission to look at it too because we want to make sure we as a credit union community aren’t blindly headed down the wrong path,” he said. “We want an objective group to either tell us we were wrong or give us new ideas.”
Smith said the NCUA’s actions have created a “governance quandary” in which state chartered credit unions “are trying to figure out which master they serve.”
Protecting the dual charter should be important to federally chartered credit unions, too, he said.
“My credit union relishes the fact that we have the choice to convert to a state charter, but today (state charters) are challenged to the extent that their viability is in question,” the LGFCU CEO said. LGFCU operates using infrastructure and branches from SECU.