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Removing Barriers Blog

Credit Union Comment Letters Send Clear Message to NCUA
Posted September 14, 2015 by CUNA Advocacy

The recent comment period on NCUA’s MBL proposal generated what some have said is a record number of comment letters to the agency, eclipsing the number of comments submitted on the first risk-based capital proposal.  NCUA says more than 3,000 comments came in on the more recent proposal, and CUNA advocacy staff took some time over the last few weeks to analyze the comments.    

Here’s what we came up with:

When duplicate letters from the same individual were removed, 2935 letters have been posted to NCUA’s website.  A full 2172 of these letters were identical form letters in opposition to the proposal submitted in many cases by bank employees; 72 other letters of opposition were submitted.  To be sure, opposition to the rule was voiced to NCUA, but, based on what we know about how agencies review and take stock of comment letters, we do not think they will put much stock in the carbon copied form letters generated by the banking industry. 

In support of the proposal there was a number stronger level of support, with nearly 700 letters submitted.  These letters included letters from more than 207 different credit unions and nearly 30 leagues.  We had our share of form letters (105), but there were nearly 600 letters that were customized by sender.  In addition, more than a half dozen state regulators submitted letters of support to the agency, as well as more than a half dozen U.S. Representatives.

The job of counting and categorizing the letters is tedious and labor intensive; we are sure to get more complete and accurate numbers when NCUA released the preamble to the final proposal.  But even if our numbers are not precise (after all, there may be more letter still to be posted), there are some trends that can be identified from the numbers we have, and here are our takeaways:
  • Credit unions substantively commented at an 8:1 greater rate than banks (586/71) [remove all the form letters on both sides and compare real letters].
  • Almost 9% of CUs that offer MBLs commented on the rule.  This is an incredible rate for an NCUA rule proposal. [6331 * 36% (rate from NCUA rule proposal) = 2279.  207/2279 = approx. 9%]
  • Removing the form letters renders the number of letters from banks insignificant.
  • There are no letters from Congress in opposition to the rule
Comment periods are not a contest to see who can get the most letters, and that the number of comment letters isn’t determinative of changes in final proposals (if that were the case, we’d expect to see very significant changes in the final risk-based capital proposal), but it’s important not to lose sight of the fact that that those in support of the proposal spoke with a louder and more substantive voice than those who opposed the proposal.  We are confident that this will not be lost on the Boardmembers during the next phase of the rulemaking.