NCUA Chairman, Rodney Hood, testifies on Capitol Hill
Thursday, May 16, 2019
NCUA Chairman Rodney Hood provided two days of testimony on Capitol Hill. He did very well.
Here are some high-level bullet points based on observations from the gallery plus conversations with Committee staff in both the House and Senate.
- Hood endorsed third party vendor authority. (Unfortunately for those opposed) he did it in a very smart way: he couched it in terms of cybersecurity and protection of consumer data. The “cyber” word carries a growing mystique on Capitol Hill, and anyone citing it has a good chance of getting what they want. The test here will be whether the Agency pushes legislative language with Congress. They haven’t yet.
- In response to numerous questions on CECL, Hood joined other regulators in saying they will evaluate capital options as a way to mitigate the impact of the new standards on lending. Senior Committee staff afterwards that, while adjusted capital requirements are an option, there is also risk for both regulators and Members of Congress who encourage that. When the next crisis hits, who wants to be accused of being soft on capital? It sounds like the House may do another hearing on CECL this summer.
- All the regulators, including Hood, said that FASB should have conducted a cost-benefit analysis. They all committed to a non-specific regulatory cost-benefit analysis. Staff wondered aloud how useful that would be given the limited scope of what the regulators could do.
- Hood explicitly endorsed indexing Currency Transaction Reporting in Bank Secrecy Act reform. Made a good case about reg burden.
- Rep. Zeldin asked about his bill, HR 1661 (extending loan maturity limits), and Hood said he supported anything that would make lending more consumer-friendly and practical.
Chairman Hood will be speaking at the DCUC Annual Conference in Chicago and will share his views on regulatory matters. Be sure to register at www.dcucannual.org.