While the credit union model is the most effective one forhelping middle class citizens improve their financial health,government officials should enact policies to enable credit unionsto do even more, Wright-Patt CU President/CEO Doug Fecher told aSenate panel on Tuesday.

While testifying before the Senate Banking Committee'sSubcommittee on Financial Institutions and Consumer Protection heexpressed hope that the new Consumer Financial Protection Bureauissues regulations that “empower consumers without adding to ourregulatory costs.”

Fecher noted that his credit union's hometown of Dayton, Ohio,has lost 33,000 jobs during the recession and that “the need forour services has never been greater.''

He said that Wright-Patt CU helps its members by disclosing the cost ofloans and other products up front. But he noted that while hiscredit union will change some terms of mortgages, he opposesreducing the principal because the costs will just be shifted toanother part of the economy and that will be a net negative.

Wright-Patt CU is a $2.1 billion financial institution withabout 210,000 members.

The credit union tries to teach members how to be good borrowersand savers and its goal is to “create an environment that helpspeople change their lives,'' Fecher said. In response to a questionfrom Subcommittee Chairman Sherrod Brown (D-Ohio), Fecher agreedthat consumers should have more precise information about mortgagecosts so they know what they are getting into.

This could reduce the cost of housing and allow people to spendmoney building financial assets in other areas, Fecher added.

He also said that if the CFPB requires additional disclosurefrom all financial institutions, credit unions would look veryattractive because their practices and products benefitconsumers.

The full Senate Banking Committee is scheduled to vote Thursdayon the confirmation of former Ohio Attorney General Richard Cordray to head the CFPB.

Fecher said that Cordray understands the unique mission ofcredit unions though he didn't take a position on whether Cordayshould be confirmed.

Senate Republicans have said they won't allow a CFPB director tobe confirmed unless the Obama administration agrees to change thebureau's structure.

Fecher said his credit union was at a disadvantage because untilthe CFPB has a permanent director it is forbidden by law toregulate payday lenders and pawn shops. While credit unions are themost heavily regulated financial institution his competitors aren'tand this creates an uneven playing field, he said.

But another witness, banking consultant G. Michael Flores, notedthat many of those businesses are regulated by state governments soit is “a bit misleading to say they are unregulated.''