NCUA Board Members Offer Legislative Recommendations

In their opening statements at the April 16 National Credit Union Administration (NCUA) Board meeting, Board Members J. Mark McWatters and Todd Harper offered suggestions for legislation that he stated would benefit credit unions during the COVID-19 pandemic and beyond.

Both Harper and McWatters recommended that Congress allow all federal credit unions, not just multiple common-bond credit unions, to serve underserved areas in their field of membership, provide an additional $10 million in appropriations for the Community Development Revolving Loan Fund, and grantg NCUA with the authority to supervise third-party vendors.

With regard to member business loans, McWatters called on Congress to raise or eliminate the member business loan cap of 12.25 percent of assets, while Harper stated that Congress should temporarily allow all member business loans made on or before the start of the COVID-19 public health emergency through December 31, 2020, be exempt from the member business lending cap.

Both recommended restructuring the Central Liquidity Facility (CLF). Harper called on Congress to make permanent or extend the temporary changes to the CLF that are scheduled to expire on December 31, 2020. McWatters advocated for the creation of a permanent, separate and robust, standby liquidity facility for the NCUA to employ as needed or the permanent restructuring of the Central Liquidity Facility (CLF) to create the same.

Additionally, McWatters called on Congress to enact capital reforms to assist credit unions that may experience a downtick in their capital during the economic downturn. McWatters was not specific on the nature of these capital reforms.

Read the statement.