Mon, Aug 29, 2016
District Of Columbia
*Disclaimer* - This article does not constitute as an endorsement from the association.
The Clinton Campaign just released a ‘white paper’ highlighting it plan to assist credits unions and other financial institutions. Overall it signals a positive development that credit unions are part of the discussion moving forward in a Clinton Administration should that occur. It is also worth noting that while there is a good bit of regulatory burden referenced, there is nothing about restructuring or restraining the CFPB.
- Make clear when community banks and credit unions are exempt from regulation and cut down on regulatory “creep.” While smaller institutions are often explicitly exempted from financial regulations intended for larger ones, many are spending precious resources on lawyers and consultants simply to figure out that they are in fact exempt. Clinton would require regulators to issue statements of less than five pages that explain, in straightforward language, how their rules will affect small firms. Moreover, even when regulatory exemptions are apparent, examiners often still require that smaller institutions follow rules designed for bigger ones as a matter of regulatory “best practice.”
- Avoid duplicative and unnecessary examinations for community banks and credit unions. Bank and credit union examiners from different regulatory agencies at the federal and state level still too often fail to coordinate their exam schedules and decline to share information with each other, resulting in unnecessarily duplicative supervision. And credit unions are often subject to rigid exam schedules and rules that create unnecessary burdens on healthy institutions. Clinton believes that regulators must do a better job of coordinating their examinations of community banks and credit unions and sharing information in a prompt and complete fashion. And she supports making exams schedules more flexible for healthy credit unions so they don’t face unneeded supervision.
- Streamline safe mortgage lending by community banks and credit unions. Before the crisis, Wall Street promoted dangerous mortgage products, even when they knew borrowers might get into trouble, harming countless communities in the process. But when community banks and credit unions offer mortgages, they’re looking to invest in their neighborhoods and communities to help them grow and prosper. Clinton supports a proposal put forward by Senate Democrats to expand the safe harbor for “qualified mortgage” liability protection to include all mortgages made by community banks and credit unions with under $10 billion in assets—so long as the loans have appropriate documentation, don’t include excessive fees or interest rates, and are kept on the bank or credit union’s books.