Rodney Hood speaking at GAC.
Previewing what may become a major regulatory effort, the two Republican members of the NCUA board on Wednesday said they want to make it easier for organizations to start credit unions.
"The NCUA had one new charter last year," NCUA Board Member Rodney Hood said at CUNA's annual Governmental Affairs Conference, which is being held virtually this year. "Only two are planned for this year. These data are, quite frankly, unacceptable. The agency can make it incredibly difficult to get a new charter. We aren't saying chartering a credit union should be easy, but it shouldn't feel impossible for many organizing groups."
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Hood said that fellow Board Member Kyle Hauptman has been focusing on the issue since joining the board and that he supports that effort.
"There has got to be an easier path for de novo credit unions," Hauptman told those attending GAC. "I'm from Maine, and I was pleased to hear about a new credit union chartered in my home state just last year — until I learned it took nine years to accomplish."
He added, "Self-reliant, accountable people who want to work cooperatively with others to charter a new credit union that they will own, deserve a clear path to make that a reality."
In recent years, the NCUA board has not focused on the process of starting a credit union. And in his speech on Tuesday, NCUA Chairman Todd Harper did not list the issue among the priorities he wants the board to address.
Hauptman said he is aware of CUSOs, vendors and other credit unions that want to work on the issue.
And addressing one of Harper's main priorities of consumer protection, Hauptman said, "The best consumer protection has always been vigorous competition, allowing American businesses to do what they do best: Innovating to find ways to give consumers a better choice, a better product at a lower price."
He added that it is impossible to protect consumers without first examining whether the NCUA's rules are inhibiting credit unions' efforts to help members.
Hood said that the NCUA will be asking the credit union community to help streamline the chartering process, adding that "a system with almost no new start-ups is not sustainable."
Hood also said he wants the NCUA board to adopt a final rule expanding the lending authority for CUSOs.
He said the rule is needed "to respond to technological changes in the industry and to better meet your members' needs."
The future of that proposal is unclear. Harper opposed the rule when it was first proposed. While the chairman generally sets the board agenda, two board members can force the board to address an issue.
Hauptman also said the NCUA should examine blockchain technology and digital assets like cryptocurrencies, adding that the Office of the Comptroller of the Currency recently issued guidance on related issues.
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