Attendees at the National Association of Federal Credit Unions Congressional Caucus on Tuesday agreed that new financial regulations are an overreaction to the financial crisis and are hurting credit unions.
House Oversight and Government Reform subcommittee Chairman Patrick McHenry (R-N.C.) said he was concerned that the Consumer Financial Protection Bureau will hurt credit unions’ ability to stay solvent and could reduce their product and service offerings, according to NAFCU.org.
McHenry said the single director structure of the CFPB could be dangerous to credit unions because bureau rules can only be overturned with a two-thirds vote of the Financial Oversight Stability Council and only if the council agrees that the rule would undermine the entire financial system.
This includes debate on a rule that would put a credit union out of business.
McHenry commended the NAFCU for looking for a “feasible and workable solution” to the CFPB “so you don’t have a bureaucracy that will ban a product that your members want,” according to NAFCU.org.
President Obama did not include a tax exemption for credit unions in his deficit reduction proposal, which was released on Monday, although McHenry said it had strong bipartisan support in Congress.
Rep. Allen West (R-Fla.) and House Financial Services Committee Chairman Spencer Bachus (R-Ala.) also spoke at the Caucus about Dodd-Frank regulations and its stifling impact on credit unions.
Bachus said the regulations cost too much time and money.
The new law issued 3,700 new regulations last year. Only 25 percent of the rules, however, have been implemented, according to NAFCU.org.