NCUA's Johnson applies lessons learned in political career to credit union regulatory environment

SAN ANTONIO, Texas – Newly confirmed NCUA Board member JoAnn Johnson spoke to attendees at the Texas Credit Union League's 68th Annual Meeting and Convention, April 18-19. Following her presentation on the second day of the conference, Credit Union Times had the opportunity to find out more about her goals and priorities in a personal interview. Excerpted below are some of her comments: CU Times: Yesterday, NCUA voted to repeal the Community Action Plan (CAP), which would have required credit unions to document in writing how they plan to serve their community. You and Chairman Dollar voted in favor of the repeal and Deborah Matz abstained from the vote. What thought processes supported your decision? Johnson: CAP was a slap on the wrist for banks. That was not the case for credit unions. Credit unions are doing the right thing without the regulation. In 2001, federal credit unions added 231 underserved areas to their fields of membership. Texas was the most active state, adding 66 underserved areas, opening the door to more than 4 million potential members who otherwise might not have had access to affordable financial services. Credit unions serve only the communities in which they are chartered. They can't and don't engage in actions that necessitate CAP. I don't see the need for undue regulatory burden. NCUA will continue to work with credit unions on a positive basis with programs such as Access Across America. CU Times: As a former state senator, you traded in your legislative duties for regulator duties. From a former legislator's perspective, what advice can you give credit unions wanting to enlist legislative support? Johnson: The first time you meet an elected official should not be to ask a favor. You should have a relationship in place beforehand. I encourage credit unions to invite legislators out to scholarship award nights or chapter meetings so they can see what you're doing and the important role you play in the community. Project Zip Code is a valuable tool. It's important to a legislator to know how many credit union members are in his or her district. But it shouldn't stop there. You also have to use that tool to get credit union staff and members volunteering in campaigns for the candidates who will support credit unions. Educating legislators early is so critical. If the right laws are in place from the beginning, it's much easier to regulate. Bankers have long understood the importance of having a presence on Capitol Hill. We need to do a better job of tooting our own horns, reaching our fields of membership. Banks are doing a better job of putting their names on backboards at ballparks and so on. Our advertising efforts don't have to be expensive. So much can be done by word of mouth. Credit unions have camaraderie in membership that banks don't have. CU Times: What are your and NCUA's priorities in the near future? Johnson: My responsibilities include making sure credit unions have wise use of NCUA resources, protecting the share insurance fund, and ensuring effective supervision. I maintain loyalty to the dual chartering system. Programs such as Reg-Flex and Incidental Powers will enhance federal credit unions' ability to compete in a changing financial marketplace. My goal the few months is to get out in the field, meet people, and find out about their credit unions. In this morning's breakfast meeting, I heard about member business loans for agriculture, financial education through church-based credit unions, which fits in well with Access Across America, and efforts to reach Hispanic members. My job is to take these successful programs to other parts of the country. We don't have to re-invent the wheel. NCUA will also be looking at alternative or secondary capital. Congressman Sherman in California is trying to attach an amendment to the Regulatory Relief bill, but it probably won't be successful. We'll be looking at 704 – Corporate Regs – and we should have recommendations by July. CU Times: You've said you advocate an open door policy at NCUA and that you want to be a "facilitator." What does this mean? Johnson: The NCUA Board has a new energy in an environment of respect and professionalism. I'm finding a lot of credit unions poised to move forward together with us. I will listen to all sides of an issue to come up with a reasonable solution. We won't agree on everything, but when we disagree, we'll disagree in a collegial manner. -