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ALBUQUERQUE, N.M. – State and federal regulators may have differences of opinion on several issues, but they should be on the same page when it comes to generating membership growth to protect the safety and soundness of the credit unions they regulate. Speaking on day three of NASCUS’ Annual Conference, NCUA Board member Debbie Matz told her listeneners that, “Between plants closing, businesses downsizing, and members who are aging, it’s safe to assume existing members will not be around forever. In order to thrive in the future, credit unions need to reach new markets.” Pointing out that new markets “are home to millions of potential members who are underserved by insured financial institutions, including ethnic groups with cultures unfamiliar to credit unions,” Matz advised regulators to encourage credit unions to consider multicultural marketing techniques and special services to attract underserved groups. She detailed the importance of services such as small loans, risk-based loans, volunteer income tax assistance, international remittances, financial education, member business loans, and affordable mortgages. “These services not only increase membership, they build loan volume, spread risks, and as a result they strengthen safety and soundness,” said Matz, who also emphasized that generating growth is particularly critical to the survival of small CUs which are disappearing at the rate of one per business day. “There is more that we can do if we, as regulators, recognize the important of small credit unions,” the NCUA Board member said. “Small credit unions require a more tutorial approach. I believe we need to work together to develop approaches and reward efforts to assist small credit unions that have an opportunity to grow and thrive.” By taking actions such as these, Matz said regulators can help protect all credit unions from their greatest long-term safety and soundness threat – taxation. “State and federal legislators who may be thinking about taxation expect credit unions to serve more constituents who are underserved. To many of these legislators, small credit unions are the icon of the credit union community because they tend to be located where there are no other insured financial institutions. “By helping small credit unions survive, and encouraging all credit unions to reach new members in new markets, I believe regulators can make a difference in preserving credit unions’ tax exemption, which is critical to protecting safety and soundness,” Matz concluded. -

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