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If absence makes the heart grow fonder, those who are restructuring the way the financial services sector is regulated must love the NCUA. The agency hasn’t been mentioned in any of the reports circulating about plans to consolidate some of the existing regulators. The NCUA also wasn’t included in Treasury Secretary Timothy Geithner testimony before the House Financial Services Committee in March. Within the next few weeks, the Obama administration is expected to unveil its full proposal, which is likely to include giving the federal government more power to regulate systemic risk through the Federal Reserve or the FDIC. CUNA and NAFCU officials said that while they have heard strong words of support from a variety of policymakers about keeping the NCUA independent, they take nothing for granted. They said it’s important to keep the NCUA independent because of the unique nature of credit unions and to avoid having the NCUSIF lumped together with the FDIC fund used to insure banks. “I am pleased about the reassurance, but just because lots of people tell you one thing that doesn’t mean you shouldn’t be prepared for something else happening,” CUNA President/CEO Dan Mica said. A NAFCU lobbyist said it received similar reactions during discussions, but nothing is at all certain at this point since the Obama administration is still finalizing its plan. The administration has said it favors placing systemic risk powers in the hands of one regulator-likely the Fed-even though some lawmakers and lobbyists, including the American Bankers Association, are pushing for a council of regulators. But a source familiar with the thinking of Geithner said the secretary indicated that he thinks the council concept is a “nonstarter.” Lobbyists for CUNA and NAFCU said they are also paying close attention to the possibility that the Obama administration will create a separate agency to regulate financial service products, such as credit cards and mortgages. Both groups said they haven’t taken positions on the idea. The House is likely to consider the proposal first and could complete action before its month-long summer recess in August. –[email protected]

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