Regulators Engage with CA and NV Credit Union Leaders

National Credit Union Administration (NCUA) Board Chairman Mark McWatters addresses California and Nevada credit union leaders.
National Credit Union Administration (NCUA) Board Chairman Mark McWatters addresses California and Nevada credit union leaders.

Credit union leaders from California and Nevada met with National Credit Union Administration (NCUA) Board Member J. Mark McWatters and representatives from the Consumer Financial Protection Bureau (CFPB) during this past week’s 2020 Governmental Affairs Conference (GAC) in Washington, D.C. — hosted annually by the Credit Union National Association (CUNA).

Both meetings provided opportunities for great dialog between the regulators and member-credit union leaders of the California and Nevada Credit Union Leagues.

McWatters discussed several issues, including the proposed subordinated debt rule for RBC purposes; implementation of CECL (current expected credit loss) and a proposal coming soon to allow credit unions to phase in the day-one adverse effects; and NCUA authority to review third-party vendors.

Panelists from the CFPB also fielded questions from the audience. Topics included the proposed rule to increase the remittance transfers threshold, as well as urging the bureau to eliminate the 30-minute wait period; seeking changes to the qualified mortgage (QM) definition; and Home Mortgage Disclosure Act (HMDA) reporting. Credit union leaders can expect proposed rules on QM and on HMDA this spring.

“We want to thank everyone who participated in these important conversations,” said Sharon Turley, vice president of regulatory advocacy for the Leagues.

In her remarks at the GAC’s general session, CFPB Director Kathy Kraninger said the bureau is working diligently to issue, no later than this May, a proposed rule to amend the Ability to Repay/Qualified Mortgage (ATR/QM) rule by moving away from the 43 percent debt-to-income (DTI) ratio requirement. Instead, the bureau would propose an alternative, such as a pricing threshold.

The Leagues have long advocated for a change in the DTI ratio and appreciate the bureau’s intention to amend the rule.

Kraninger also indicated the bureau plans to finalize proposed changes to the remittances rule in May. As proposed, the amendments would allow the use of estimates in some circumstances and adjust the safe-harbor threshold from 100 to 500 or fewer transfers in the current and prior calendar years.

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