added dynamic and “that is the
added uncertainty that is piled
onto the fact that we have a new
administration.”
“There’s going to be change in
Washington and there’s consider-
able uncertainty about what that
might look like,” Ryan Donovan,
CUNA’s chief advo-
cacy officer, said.
The year startswith turmoil at theNCUA.
President-electBiden is likely todesignate boardmember ToddHarper, a Democrat, as chairman. He would replace Rodney Hood, a Republican. That leaves the board witha Democratic chairman and twoRepublican members – Hood andnew member Kyle Hauptman.
Hood, who currently sets theboard agenda, loaded the December board meeting with issues thatclearly reflected his priorities. Theboard passed a budget that Hoodand Hauptman supported, butHarper opposed. The board alsoapproved proposed rules settingoverdraft policies and mortgageservicing that the two Republicanssupported and Harper opposed.
The January board meeting is
scheduled for Jan. 14 – the sec-
ond Thursday of the month, when
Hood will still be chairman. Nor-
mally, the board meets the third
or fourth Thursday of the month.
That falls on Jan. 21 – the day afterBiden is sworn in. By then, Harpercould be chairman.
“That’s something that the president can do after he’s inaugurated,” Donovan said.
“It’s very unclear what the
NCUA will look like,” Hunt said,
adding, “Except that January may
look the same.”
To make matters even more
dicey, the board, acting in private,
elected Hauptman as vice chair-
man of the board. The December
meeting was Hauptman’s first
meeting as a board member.
Harper’s proposal to expandthe consumer protection staff andenforcement is likely to be a flashpoint. Hood has opposed thatproposal. “Board member Harper has a fundamentally differentview,” Donovan said.
“We would argue with that,” hesaid, adding that CUNA opposesHarper’s plan.
Donovan said there may be afight brewing over the NCUA’sequity ratio, which is now set at1.38%. Harper may want to increase that, Donovan said, adding that CUNA will also opposethat.
The pandemic has ramped upthe NCUA’s move to off-site examinations, as agency officials workremotely. Hunt said the agencyshould address how it plans toconduct examinations once thepandemic ends. “We think thereneeds to be more transparency asthe NCUA moves toward virtualexams,” she said.
Donovan said he remains hopeful that Harper can work well withhis Republican colleagues.
Harper has worked as a Housestaffer and director for the agency’s Office of Public and Congressional Affairs, and chief policyadvisor to former Chairman Debbie Matz and board member RickMetsger.
“I have seen Mr. Harper workwith Republicans throughout hiscareer,” Donovan said.
Then, there’s the CFPB.
In the past, the agency’s direc-
tor could only be removed by
the president for cause. This past
summer, the U.S. Supreme Court
ruled that structure is unconsti-
tutional. Now, the president can
simply fire the CFPB director at
will.
Donovan and Hunt said it isnot a question of if Biden will fireCFPB Director Kathy Kraninger,but when. Biden has packed theCFPB transition team with advocates of a stricter regulatory regime – something Kraninger hasopposed.
But Biden will take office facinghuge issues, including the pandemic and a faltering economy.
“I think the change at the CFPBis going to be significant, but Idon’t know whether it will be rightout of the gate,” Donovan said.
When Biden replaces Kraninger, “that certainly will have alarge impact on credit unions,”Hunt said.
She said that whoever Biden
chooses is likely to have regula-
tory priorities similar to former
CFPB Director Richard Cordray,
who ran the agency during the
Obama Administration. She
said that could lead to tighter
regulation of the debt collection
industry. The agency also has is-
sued debt collection rules govern-
ing third-party debt collectors, but
Hunt said a new director could ex-
pand those rules.
Hunt also said a new director may propose rules governingoverdraft policies. Democrats favor tighter regulation of financialinstitution overdraft policies.
In addition to regulation, anew CFPB director may chooseto tighten enforcement of consumer protection laws, she said.Consumer advocates have saidthat the agency, during the TrumpAdministration, abandoned strictenforcement and have been pushing the incoming administrationto return to Cordray’s enforcement priorities.
The coronavirus pandemicand the economic crisis it hascaused has proven to be devastating for many Americans. ButHunt said that credit unions havehelped their members weatherthe crisis.
“Consumers have really seenhow credit unions have beenthere for members,” Hunt said. n
D.C.
CONT. FROM PAGE 1
Key Takeaways
Y With a new administration, CUs should expectto see a lot of changes this year at the NCUA
and CFPB.
Y Officials expect the NCUA’s priorities andpower to shift on the NCUA board.
Y CU experts suggest that the CFPB will returnto its Obama-era regulatory oversight.
Donovan ‘I think the change at
the CFPB is going to be
significant, but I don’t
know whether it will be
right out of the gate.’
‘There’s going to be
change in Washington
and there’s considerable
uncertainty about what
that might look like.’
‘We think there needs to
be more transparency as
the NCUA moves toward
virtual exams.’
