Today,
CUNA Chief Economist Mike Schenk presented before the NCUA Board regarding the
agency’s 2021-2022 draft budget.
We
appreciate the NCUA’s effort in publishing a detailed draft budget that
rationalizes agency expenditures. We, once again, find the NCUA’s Budget
Justification document to be clear, comprehensive, and well-developed. The
proposed activities and expenditures described generally align with previously
announced and vetted strategic initiatives. It also appropriately responds to
changing supervisory priorities, especially in light of the COVID-19 crisis.
However,
the Budget Justification document is a fairly high-level summary that—perhaps
by design—omits detail necessary to adequately assess the need and
rationalization for each of the individual
new positions proposed. We know the duties to be performed—but little about the
need for those duties to be performed. In that regard, CUNA believes that the
efficiency of NCUA’s operation are paramount to responsibly using credit union
members’ resources as NCUA seeks to become a world class regulator.
Furthermore,
we have real concerns around any obvious expansion in consumer protection examination
activity. Our members believe altering the agency’s risk-focused examination
process and substantially increasing examination-related expenditures is simply
not warranted. The agency provides no supplementary evidence to suggest credit
unions’ consumer compliance management has become a risk area warranting an
increased expenditure of agency resources. As its mission statement makes
clear, the NCUA exists to ensure the safety and soundness of the credit union
system, and its examination program should remain focused on that objective. In
addition, the agency already has the tools in place to further evaluate a
credit union’s consumer compliance program when a need is identified through
the risk-focused examination process.
Read
Schenk’s entire testimony here.
NCUA
staff also presented
during the briefing.
The
agency is accepting public comments on the draft budget until December 11. The
Board is scheduled to vote on the budget at the December 17 open Board meeting.