Blaine, Cheney React to CFPB Bill
Reaction was lukewarm to a bill introduced Thursday in the Senate that would reduce the number of credit unions directly supervised by the CFPB. The bill, introduced by Sens. Pat Toomey (R-Pa.) and Joe Donnelly (D-Ind.), would increase the minimum asset size of institutions under the CFPB’s supervision to $50 billion.
Jim Blaine, CEO of the $28 billion State Employees’ Credit Union in Raleigh, N.C., joked that a $500 billion threshold would be much better.
But the outspoken CEO, who has had his well-publicized differences with the NCUA, said he prefers the CFPB.
“We are happy with the sophistication level at the CFPB and it might be wise to transition all $10 billion-plus credit unions from NCUA to CFPB or FDIC/OCC over time,” Blaine said.
Bill Cheney, president/CEO of the $10 billion SchoolsFirst FCU, said his cooperative just reached the minimum asset size earlier this year, so it won’t host CFPB examiners in its Santa Ana, Calif., headquarters until next year.
Cheney said he supports the legislation but added if it passed that would leave just one credit union directly supervised by the CFPB, the $60 billion Navy FCU, which he said doesn’t make sense.
“Credit unions were not a part of the problem the CFPB was created to fix, and I wish instead they’d just say the CFPB isn’t going to supervise any credit unions at all,” Cheney said.
SchoolsFirst has nothing to fear from CFPB exams, he said, but an additional regulator will mean additional expenses that won’t be spent on members.
Cheney, the former CUNA president/CEO who just relocated from Washington to California in June to take the SchoolsFirst job, was not optimistic the bill would pass both the Senate and the House in the waning days of the 113th Congress.
NAFCU Director of Legislative Affairs Jillian Pevo shared Cheney’s position that all credit unions should share the same regulator.
“We appreciate the leadership of Senators Toomey and Donnelly for introducing the Consumer Financial Protection Bureau Examination and Reporting Threshold Act of 2014,” she said. “This is a great step forward for credit unions, though we would prefer to see all credit unions exempted from CFPB supervision and we will keep working toward that.”
She added that NAFCU was the only financial trade group that opposed allowing the CFPB to supervise any credit unions when the creation of the bureau was originally proposed.
John Magill, EVP of government relations at CUNA, thanked Toomey and Donnelly for introducing the bill and considering credit union needs before the Senate leaves for its five-week district work period. However, Magill said, more could be done.
“While this bill is a welcome development, CUNA continues to urge the CFPB to use its broad exemption authority for credit unions more extensively, as we strongly believe there is more CFPB can and should do on its own to exempt credit unions from unnecessary regulations,” he said.