CLEVELAND, Ohio (4/17/12)--Although credit unions did not cause the financial crisis, "they have been subjected to a flood of regulations that create an unnecessary burden without any measure of the effectiveness of these changes," Stan Barnes, president/CEO of Canton, Ohio-based CSE FCU said during a Monday House subcommittee on financial institutions and consumer credit field hearing in Cleveland, Ohio.
Barnes in his statement noted that Ohio credit unions have been subjected to more than 160 new rules and regulations from 27 different federal agencies since 2008, and added that there are at least 27 rulemaking proposals pending at various agencies, including the National Credit Union Administration (NCUA), the Federal Reserve, and the Consumer Financial Protection Bureau.
He said credit unions have told the NCUA that the agency's examiners "are practicing regulatory micromanagement and overreach," and "are dictating the business of operating a credit union."
Steps to stem this tide have been suggested by the Credit Union National Association (CUNA) and credit unions, and Barnes repeated this call in his testimony, suggesting that the NCUA impose a moratorium on new regulations for at least the next six months and reinstate the Regulatory Flexibility Program, "which provides well-managed and well-capitalized credit unions an exemption from regulations that are not statutorily required."
The credit union CEO also told members of the committee that the Financial Institution Examination Fairness and Reform Act (H.R. 3461), which is sponsored by the subcommittee chair, Rep. Shelly Moore Capito (R-W. Va.), and its ranking subcommittee member, Rwp. Carolyn Maloney (D-N.Y.), "would be a positive step in balancing the relationship between the regulated and the regulator."
The hearing also featured testimony from Bill Blake, senior vice president and associate general counsel for KeyBank; Courtney Haning, chairman, president and CEO of Peoples National Bank; Steven Fireman, president and general counsel of the Economic and Community Development Institute; and Martin Cole, president and CEO of Andover Bank.
For more testimony from the hearing, use the resource link.