ALEXANDRIA, Va. — The NCUA Board took on a number of serious issues impacting the entire industry over 2006 and there appears to be no let up for 2007.
A key process for 2006 was NCUA's data collection effort as assigned by Congress to provide some information on credit union service to those of modest means. "I think we were very successful in doing it as unobtrusively as possible, making the process as easy as we could…and I think the credit unions were appreciative of that fact," NCUA Chairman JoAnn Johnson commented. "And, I think, the actual information to come from the data was very positive in many respects, showing that credit unions are serving those they are chartered to serve and that the numbers increase when they're allowed to serve a broader field of membership." These are important points she hopes to drive home for Congress, which she said has recognized the effort the agency put into the Member Service Assessment Pilot program.
The board has already started moving forward to consider the staff recommendations from the report, which include ongoing data collection as part of regular examinations.
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NCUA Board Member Gigi Hyland was named to head up the Outreach Taskforce. "To me that is going to be my major focus for the coming year," Hyland stated. She, through the taskforce, will provide guidance to the board on how potentially to proceed with the recommendations of the MSAP. She did not have any details on the scope or timing of the taskforce's efforts, but said a decision on the composition of the group would be coming soon.
As a former community development banker, NCUA Vice Chairman Rodney Hood said that it "pains me" that the banking trades continue to attack credit unions' efforts to serve the underserved while telling Congress they are not doing enough. He applauded the data collection effort as a "comprehensive and cohesive report," adding, "We, as an agency, should not retreat in defeat."
Heading into 2007, Hood plans to immediately get started on educating credit unions about "managing risk with innovation." Jan. 11, he will be hosting a Risk Mitigation Summit in Washington, D.C. "I think one thing for me in 2007…is going to be to really look at risk in a perspective of how do you look at risk and embrace it as you manage change," he said. "That's something that's important for credit unions to hear. I think it's very unusual for the regulator to encourage folks to take on risk…I say embrace it if you're going to grow in today's dynamic marketplace."
Hood said he wants credit unions to look at product development and see the most advanced trends in asset liability management and balance sheet management, as well as other aspects of enterprise risk management through 2007, IT risk and disaster recovery.
"At the end of the day, I want credit unions who have participated in the Summit to know that there is a marketplace out there where they can grow and develop their product array, serving their members, and still doing it by using the best and most sophisticated tools in risk management."
This year has been the first full year with three seated NCUA Board members since former Chairman Dennis Dollar left the board in 2004. Chairman Johnson's term officially expires Aug. 2, 2007, while Hood's runs through April 10, 2009 and Hyland's extends through Aug. 2, 2011. NCUA Board members are generally limited to six-year terms. –[email protected]
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