WASHINGTON—While the credit union industry, including NCUA, expresses concerns about the potential consolidation of the nation’s prudential banking regulators, Treasury Secretary Scott Bessent stated he does not support the idea.
Speaking in New York, Bessent said the Trump administration’s work to streamline banking regulations and ensure agency coordination would not include consolidation of the nation’s federal regulators.
Scott Bessent
“To be clear, this does not mean consolidation of agencies, but coordination via Treasury, such that our regulators work in parallel with each other and industry,” he said.
NCUA Board Member Todd Harper, speaking during the Defense Credit Union Council's recent Defense Matters event, said NCUA is doing all it can to maintain the independence of the agency, stressing the importance of NCUA making it clear to the new Administration and Congress there is a distinct difference between credit unions and banks and that the oversight of both is not the same.
Harper emphasized that the new Administration must not view regulatory agencies as “one size fits all.”
In the past, particularly as the Dodd–Frank Wall Street Reform and Consumer Protection Act was being written, there have been efforts on Capitol Hill to try and consolidate regulators that have not succeeded, Harper noted.
He pointed out that NCUA today has a complex job.
“Our largest credit union is $181 billion in size and our smallest credit unions are under $100 million. If you would put NCUA into an entity that examines things of trillions of dollars in size…I'm very much worried about a one-size-fits-all approach getting developed and not understanding the nuances of how credit unions operate,” Harper said.
ICBA Reacts
The Independent Community Bankers of America (ICBA) applauded Bessent’s for his remarks.
“ICBA and the nation’s community banks strongly support Secretary Bessent’s remarks on the positive role of community banks to Main Street communities and ruling out consolidation of prudential banking regulators,” ICBA President and CEO Rebeca Romero Rainey said. “Community banks are strong advocates for streamlining federal banking regulations and building efficiencies, and any structural reforms should focus on promoting agency accountability and ensuring regulatory oversight is tiered and risk weighted.”
Bessent cited the value of community banks to local communities and the problem of excessive regulatory burden, noting community banks “are one of the most important reasons for the U.S. economic performance of recent decades” but are “overloaded with unproductive reporting requirements that have little to do with reducing material financial risk.”
"Wall Street's done great,” Bessent said. “Wall Street can continue doing well. But this administration is about Main Street."