WASHINGTON — Credit unions should aim to serve 100 million members by 2015 while paying careful attention to matters of financial soundness, NCUA Board Chairman Debbie Matz told attendees at CUNA's Governmental Affairs Conference.

The top credit union regulator, making her first appearance at the GAC as chairman, said her agency will remain especially vigilant in monitoring the financial situation of credit unions because of the sluggish economy. She said the agency's scrutiny would focus on ensuring that credit unions practice due diligence when dealing with outside vendors and make sound decisions about which loans to keep on their books. Matz said that while she is aware of the natural tension between her agency and CUNA and individual credit unions, the heightened scrutiny is needed.

She added that her agency “isn't overreacting” in light of the dramatic increase in the number of credit unions with CAMEL 3 ratings or higher.

Matz said that once safety and soundness concerns are dealt with, credit unions can focus on growing because “there is no reason for credit unions to remain America's best kept financial secret.”

She said there are four areas that can drive the growth of credit unions: online services, which can reduce expenses and appeal to more technologically savvy consumers; short-term loans, which provide more alternatives to pay day lending; expanded member business lending; and alternative capital, which will decrease pressure on credit union capital ratios.

Matz also praised CUNA President/CEO Dan Mica for his strong advocacy on behalf of the credit union movement and for fostering “honesty, transparency and civility” in the interactions between CUNA and the NCUA. Mica has announced he is leaving his position later this year.

–cmarx@cutimes.com

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NCUA Board Chairman Matz Urges Credit Unions to Balance Growth and Soundness

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