ALEXANDRIA, Va. — NCUA Board Member Michael Fryzel recently completed 13 months as board chairman during a tumultuous time for the economy in general and credit unions in particular. He recently sat down with Credit Union Times to discuss his experiences as tenure and what his plans are now that Debbie Matz, an appointee of President Obama, is the new chairman. Before joining the board, he was a lawyer in private practice and before that was the chief regulator of financial services for the state of Illinois.Credit Union Times: You came to the board at a time when the economy was going from bad to worse and there were signs of trouble for corporate and natural person credit unions. What went through your mind at the time and do you have any thoughts in hindsight about how the board and agency handled things?Michael Fryzel: The last 12 months have been the most difficult that credit unions and the NCUA have endured. The other board members and I saw early on that we’d have problems with the corporates and the natural person credit unions in the sand states. We moved quickly to get Congress to raise the CLF’s lending authority to $41 billion. Later on, as the situation became more severe at U.S. Central and Wescorp, we guaranteed the deposits of natural person credit unions, infused $1 billion in capital into U.S. Central. Everybody pulled together, and Congress was very cooperative in giving everything we needed.CU Times: What went through your head? Did you ever wonder, ‘What did I get myself into?’Fryzel: It was very intense. When I started reviewing things with the staff, I felt we had to act quickly and decisively. The staff responded well to my requests for information and for proposals, and when I had concerns about certain things, they came back with alternatives. I encouraged everyone to step back and look at all the alternatives and examine things in a different light.CU Times: Given that Republicans are known for being skeptical of regulation, did you ever receive resistance to your actions from the Bush administration when they were in office during the first five and a half months of your tenure?Fryzel: Since assuming the chairmanship, there weren’t requests to change decisions from either the Bush or the Obama administration. Everyone saw we were handling things and were generally helpful.CU Times: Even though you had experience as a state regulator, running an agency like the NCUA involves dealing with similar issues but on a much larger scale. What surprised you the most?Fryzel: How we had to go through a lot of different hoops to get things done. We had to get approval from Treasury or from [Federal Reserve] Chairman [Ben] Bernanke. We couldn’t always make a decision and the next day start implementing it. But that’s the federal government and what we had to deal with.CU Times: How much of a challenge is it to strike a balance between protecting safety and soundness and giving credit unions the maximum ability to innovate?Fryzel: The board always recognizes the need for credit unions to compete, but our primary goal is to make sure they operate safely. We always strive to have as much regulation as needed but not an excessive amount. It’s a fine line and at times fairly difficult. I don’t think we put greater pressure on [credit unions,] but we enforced the regulations that were there. We do what we have to do and do it fairly.CU Times: How often during the crisis-especially when it became likely that the board was likely to levy a premium-did you hear credit union leaders complain about having to pay for the mistakes of others?Fryzel: Quite a bit, but you remind them that this is a cooperative movement and everyone is responsible for the overall safety of the system. But we solved corporate credit union problem and spread out the payment over time. Not a penny was lost and there was no bailout. The credit unions solved the problem.CU Times: Everyone is waiting for the board’s proposed rules on corporates to come out. What are your thoughts about what they should include?Fryzel: I am looking forward to hearing the comments at the upcoming town hall meetings, and this will give the board and staff a chance to receive input before issuing rules. Obviously, the rules will include direction about proper investments and the appropriate governance rules. We want the corporates to have board members with experience and a good sense of their fiduciary responsibility. The board is well prepared to handle this challenge. Chairman Matz brings experience to the board as do I and Board Member [Gigi] Hyland. Together, we have more experience than any other board has had in the past.CU Times: What do you think you’ll miss about being chairman?Fryzel: Being called Mr. Chairman. It’s too short a time since I left the chairmanship. I’ve been getting acclimated to my new role and focused on issues like the corporates, member business lending and alternative capital. I want to do all I can to make sure credit unions are ready to go and to take advantage when the economy gets better so they can serve their members.CU Times: What do you think about the proposals for raising the cap on member business lending?Fryzel: I have no problem with the cap being raised and no problem with credit unions doing [business lending] as long as there are strong rules in place. There have been some credit unions that have done well in this area. and those are the ones with the technical expertise while others haven’t done as well. But with the proper safeguards in place, more credit unions could enter the field and serve the many entrepreneurs who are credit union members.CU Times: What do you think the agency’s position will be?Fryzel: We haven’t reached one, and when we do, I am sure Chairman Matz will send a letter to Congress.CU Times: What’s your position on the issue of supplemental capital for credit unions?Fryzel: Over a year ago, I asked NAFCU, NASCUS and CUNA to come up an agreement with what they want it to look like, and we’re not there yet.CU Times: What are your thoughts?Fryzel: I am open to any ideas as long as they are reasonable, realistic and legal.CU Times: Are there other issues you and the board will focus on?Fryzel: Overall, the success and continued survival of credit unions. I see great opportunities for credit unions.CU Times: Will you focus on any particular issue, like Board Member Rodney Hood did on risk management?Fryzel: I haven’t decided on anything yet.CU Times: What impact did the Sunshine Law, which forbids two members from meeting together, have on your ability to do your job?Fryzel: It takes more time to get things done because you have to communicate with other board members through staffs.CU Times: Would you favor expanding the size of the board to ease that situation.Fryzel: No, a three-member board works well for the NCUA.CU Times: As a Chicago Cubs fan, how do you feel about serving on a board with two Yankee fans?Fryzel: I have great respect for the Pinstripes. Just last night I watched the game where Derek Jeter tied Lou Gehrig’s record. And if Chairman Matz or Board Member Hyland got tickets to the World Series, I would be pleased to go with them.CU Times: Wouldn’t such a gathering be a violation of the Sunshine Law?Fryzel: Not necessarily. We could put [General Counsel] Bob Fenner between two board members and [Director of the Office of Public and Congressional Relations] John McKechnie between two.