ALEXANDRIA, Va.–A relatively minor, innocuous change in NCUA rules led to another sharp disagreement between NCUA Chairman Debbie Matz and Board Member Mark McWatters.
After agency staff presented the rationale for amending Part 703.14 Permissible Activities, Bank Notes to remove the word “original” from the current requirement, McWatters suggested the only reason the tweak came before the board was because a larger credit union with a “top-tier law firm” had pushed it to the front of the agenda.
The CU and law firm were not identified.
“I suspect in reality there are many, many changes that need to be made to NCUA’s rules, and to single out this one for the fast-track seems like a poor process and poor governance by this board,” said McWatters. “I don’t note an emergency here. I can’t support this as a matter of process. The beneficiaries of this change should wait in line just like everyone else for regulatory relief.”
That led to a sharp retort from Matz, saying she took umbrage at any suggestion there is “anything inappropriate about our governance or the way we conduct business.”
Matz said she has always encouraged credit unions to be in touch with her and the agency on all rules that do not affect safety and soundness. Matz said it was a small CU that had previously suggested NCUA better align its call reporting with FDIC, which it did. She said she was at a meeting where a CU volunteer also suggested the way NCUA handles troubled debt restructurings doesn’t allow credit unions to meet the needs of their members with mortgage relief. As a result, she said, NCUA changed its rule.
“We do this wherever and whenever we can. Most of the modernization requests have come from credit unions, and they are all fast-tracked,” said Matz. “Some need more study than others because they are more complex. I take strong objection to any suggestion we have governance issues.”
The change to the rule passed 2-1, with McWatters dissenting.