NCUA chief testifies on move benefitting largest credit unions

May 13, 2020
National Credit Union Administration Chairman Rodney Hood testified on his agency's recent announcement that it is changing its methodology for designating low-income credit unions.

In testimony for a Senate Banking Committee remote hearing, Hood noted that the change, which will benefit the largest credit unions, will free these tax-exempt entities from restrictions on member business lending, raising supplemental capital, and accepting deposits from non-members.

Ahead of the hearing and a separate House roundtable today, ICBA called on the committees to convene hearings on the change, which is being enacted without a formal rulemaking process. ICBA said the move sidesteps Congress and benefits the largest credit unions.

The NCUA last week said it will begin counting active-duty military personnel with Army or Fleet Post Office addresses as “low-income” individuals, which will benefit institutions like Navy Federal and Pentagon Federal.

ICBA will continue encouraging Congress to investigate the NCUA designation and to re-examine the credit union industry’s tax and regulatory subsidies.