NCUA, CFPB Memorandum Calls for Coordination of Compliance, Enforcement

The NCUA and the CFPB will attempt to coordinate their interpretations of regulatory compliance and proposed remedies for violation of rules at credit unions with assets of more than $10 billion, according to a just-released Memorandum of Understanding signed by officials at the two agencies.

And the two agencies have agreed to share their respective schedules of examinations at covered institutions.

Credit union trade groups have long argued that the NCUA should be the lone supervisor of credit unions. However, the Dodd-Frank Act, which created the CFPB, gave the agency enforcement power over credit unions with assets exceeding $10 billion.

The CFPB released the text of the memo Thursday afternoon, with the NCUA releasing it shortly after that.

When the two agencies signed the agreement on Jan. 14, the NCUA said that it would only release the document if a Freedom of Information Act request was filed. And the agency said a target date for that release was March 3.

Henry Meier, SVP and general counsel of the New York Credit Union Association, was among those perplexed by the delayed release.

“If I was at or near this threshold, I sure as heck would want to know what was in the MOU,” Meier wrote in his blog, “New York State of Mind.” “After all, institutions have a right to know what’s expected of them; what regulators are overseeing them, and precisely with whom their supervisory information is being shared.”

Meier emphasized that his blog represents his own analysis and opinion and not those of the New York Credit Union Association.

Officials from the two agencies also will discuss the possibility of sharing self-assessment and diversity information from covered credit unions and will hold joint training sessions.

The memo was signed by NCUA Chairman Rodney Hood, who may soon be replaced by Democrat Todd Harper as chairman of the agency and former CFPB Director Kathleen Kraninger, who already has submitted her resignation at the request of President Biden.

Sources have said the memo represents an agreement between the two agencies, so it will remain in effect even if the heads of the agencies are replaced.

Read the full MOU here.