NCUA reforms were achieved through a nonpartisan approach, McWatters, Metsger tell CU group

The two members of the board that guides the federal regulator of credit unions on Tuesday credited their ability to work together in a nonpartisan fashion with the reforms the agency has achieved in recent years.

Mark McWatters, chairman of the National Credit Union Administration (NCUA) Board, and Rick Metsger, a former NCUA chairman and now a board member, made their remarks – distributed later in a press release from the agency – during a panel discussion Tuesday before the Governmental Affairs Conference of the Credit Union National Association (CUNA) held in Washington.

“Over a period spanning both of our chairmanships, we oversaw a reform and modernization effort allowing both the NCUA and the credit union system to navigate a rapidly evolving financial services marketplace while still maintaining safety and soundness,” McWatters said, according to the release. “I want to thank Rick for his support and willingness to work with me on our shared regulatory reform agenda.”

“What I am most proud of over the last three years is that we implemented these reforms, through a bipartisan – or, more accurately, non-partisan – consensus of what needed to be done,” Metsger said. “It has truly been a partnership and one that has benefited credit unions, their members, and the nation as a whole.”

McWatters is serving a board term that expires this August. Metsger’s term expired in August 2017; he has been serving in holdover capacity. Rodney Hood, a previous board member whom the president has nominated to fill Metsger’s seat, awaits confirmation by the Senate along with Todd Harper, nominated to the seat currently vacant and last held by former agency Chairman Debbie Matz.

The NCUA Board has had only two members since Matz’s departure in 2016, so its ability to issue new regulatory actions since then has depended on the two board members being able to agree on those actions.

Metsger, during Tuesday’s discussion, said credit unions should consider their product and service mix to ensure they are able to meet their members’ future needs, NCUA said in the release. It also quoted McWatters noting the need for NCUA to modernize its examination and supervision program, replace outdated technology and systems, and reduce its regulatory footprint where possible.

“The NCUA has several initiatives in process to improve and modernize how the agency conducts its examination and supervision program,” McWatters said. “This means modifying our processes and procedures, leveraging technology, collaborating with state supervisors, and moving to more off-site supervision. It will take time to develop and implement these improvements and systems, but they will transform how the agency approaches its safety and soundness mission in the future.”

NCUA says that during McWatters’ and Metsger’s tenure as a two-person board, the NCUA undertook several initiatives, among them:

  • Implementing an extended examination cycle for well-capitalized and well-managed credit unions;
  • Modernizing the NCUA’s field-of-membership rules to promote greater access to affordable financial services;
  • Closing the Temporary Corporate Credit Union Stabilization Fund in 2017 and transferring its assets and obligations to the National Credit Union Share Insurance Fund.
  • Returning nearly $900 million in share insurance dividends to eligible institutions in 2018 and 2019;
  • Implementing an agency-wide realignment consolidating several agency functions and closing two regional offices;
  • Delaying the implementation date of the 2015 risk-based capital rule for one year and raising the asset threshold defining complex credit unions;
  • Improving and centralizing the NCUA’s appeal process to make it more efficient, consistent, and transparent;
  • Making sizeable investments in new technology allowing the agency to conduct its examination and supervision functions in the future more efficiently and with fewer disruptions to credit union operations; and
  • Enhancing the transparency and accountability of the NCUA’s decisions, operations, and budget.

NCUA Board’s Partnership Transformed Regulatory Structure