WASHINGTON D.C. (7/19/13)--Submitting a statement for the record of a Thursday hearing entitled "Regulatory Burdens: The Impact of Dodd-Frank on Community Banking," the Credit Union National Association alerted lawmakers that the law has affected all financial institutions--none more than credit unions.
In the statement to the House Government Reform and Oversight subcommittee on economic growth, job creation and regulatory affairs, CUNA President/CEO Bill Cheney emphasized that the multitude of new regulations are generating a "crisis of creeping complexity," where credit unions are forced to hire specialized employees just to ensure compliance with the new requirements and reports.
Because credit unions are owned by their members, the costs a credit union bears to meet the multitude of wide-ranging regulatory training and compliance responsibilities are ultimately paid by their members.
CUNA stressed that small credit unions are feeling the most impact and reiterated that once a new rule is implemented, credit unions must assess the rule and re-evaluate how it impacts their business. "This takes both time and money which small credit unions don't have," CUNA warned.
CUNA urged the subcommittee to work closely with the Consumer Financial Protection Bureau (CFPB) on its remittance proposal, specifically regarding the restriction on the amount of annual transfers.
CUNA noted there have been no examples of abuses regarding remittance services that credit unions provide. Unfortunately, the group has said, a number of credit unions are considering exiting the service as a result of the requirements for new disclosures regarding exchange rates, fees, taxes, the date money will be received, and more.
The CUNA statement also addressed how credit unions welcomed the changes made to the qualified mortgage rule but are still weary of how it will impact them directly.
CUNA encouraged the subcommittee to continue to exercise its critical oversight and closely scrutinize the proposals coming from the CFPB, the National Credit Union Administration and other agencies to ensure the impact on credit unions is minimal.