WASHINGTON – In a House Financial Services Committee hearing Thursday, NCUA Chairman Debbie Matz told members of Congress that the NCUA has rectified the problems that have plagued credit unions since the Great Recession.
Matz said that upon her return to the NCUA in 2009, the credit union system was on the brink of collapse. The U.S. Treasury and Congress had agreed earlier that year to fund corporate stabilization.
"To prevent this, we developed an unprecedented mechanism to securitize $50 billion in toxic corporate credit union assets," she said. "Additionally, 351 consumer credit unions holding $51.6 billion in assets were close to failing by May 2010. Compounding this situation, the NCUA's budget and staffing in the years leading up to the crisis had not kept pace with credit unions' growth and increasing complexity. In fact, during the seven years leading up to the crisis, the NCUA had cut a total of 91 staff positions – even though credit union assets had increased by over 70%. During this same period, the NCUA's budget as a percentage of credit union assets declined by 35%. The NCUA was understaffed and under-resourced."
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