ALEXANDRIA, Va.–NCUA has confirmed that a regulatory freeze announced by the Trump administration on Jan. 20 does not apply to the agency, but it also said it will “nonetheless adhere to its spirit.”
Among its first acts, the Trump administration issued a memorandum to all federal executive departments and agencies to freeze new or pending regulations until the administration has time to review them. For any regulations that had yet to be sent for publishing in the Federal Register, the memo asked the agency to not send any regulation to the Federal Register until reviewed by someone selected by the President.
For those that have been sent but not published, the White House ordered the regulations withdrawn. Regarding regulations that have been published but have not reached their effective date, the memo instructs those regulations to be delayed for 60 days for review – with a potential that a new notice for reopening the regulation could occur.
“NCUA has reviewed the January 20 memorandum from the White House Chief of Staff on a regulatory freeze and has determined that, as the agency is an independent federal financial regulator, it does not apply. NCUA will nonetheless adhere to its spirit,” said NCUA spokesperson John Fairbanks. “The memorandum instructs agencies to send no regulations to the Federal Register for publication ‘until a department or agency head appointed or designated by the President . . . reviews and approves the regulation.’ President Trump has designated J. Mark McWatters as Acting Chairman of the NCUA Board, and all pending NCUA regulations have been approved by unanimous vote of the agency board.
“Since May 2016, all regulations approved by the NCUA board have been required by statute or have provided federally insured credit unions with regulatory relief, such as the final field-of-membership rule, which was approved by the board last October and becomes effective in February; the proposed field-of-membership rule, also approved by the board last October; and the advance notice of proposed rulemaking on alternative capital, approved by the board last month,” Fairbanks continued in a statement. “By moving forward with these rulemakings, NCUA is working to decrease regulatory burdens.”
NAFCU commented on the regulatory freeze.
“Reducing credit unions’ overwhelming regulatory burden has been and continues to be a top priority for NAFCU,” said NAFCU President and CEO Dan Berger. “While NAFCU and our members continue to believe that a big part of the solution to this critical problem is through legislative action, we also support other methods that achieve the much-needed reduction in onerous and costly regulations.”
NAFC added that the current regulatory environment has been “choking the credit union industry for years. Since the second quarter of 2010, when the Dodd-Frank Act was implemented, approximately 20% of the industry has been lost; an average of one credit union merges or closes every single day. Today, there are only 5,844 federally-insured credit unions.”