House Financial Services Ranking Member Maxine Waters (D-Calif.) and other Democratic committee members urged Chairman Patrick McHenry (R-N.C.) to hold a hearing on reports of discriminatory lending at Navy Federal Credit Union.
Details: The joint letter says the committee should call Navy Federal’s CEO to testify to explain the substantial disparities in its mortgage approval rates and to discuss the plan to remedy this issue. CNN recently reported that the $165-billion-asset institution had racial disparities even among applicants with similar incomes and debt-to-income ratios, noting that—unlike banks—credit unions are exempt from Community Reinvestment Act oversight.
Congressional Response: Waters previously said Navy Federal must explain to Congress how such practices took place. Senate Banking Committee Chairman Sherrod Brown (D-Ohio) and other Democratic members of the panel have separately called on federal agencies to review Navy Federal’s mortgage lending practices. And a letter led by House Financial Services Ranking Member on Housing Emanuel Cleaver (D-Mo.) and Congressional Black Caucus Chairman Steven Horsford (D-Nev.), which was cosigned by 40 lawmakers, called for answers from Navy Federal.
ICBA Letter to Committees: ICBA last month urged congressional committees to convene a broader hearing on credit union lending practices and oversight following the Navy Federal report. It called on lawmakers to explore whether Navy Federal’s practices are widespread within the credit union industry and whether permissive National Credit Union Administration oversight enables discriminatory lending.
Eyes on NCUA: Attention to credit union policy has grown amid ICBA efforts to raise questions about the industry’s tax exemption and acquisitions of community banks. A recent Federal Reserve Bank of Atlanta report noted the NCUA has no enforcement authority over third-party service providers. ICBA has testified that it supports allowing the NCUA to directly examine and regulate credit union service organizations and other third-party providers.
More on Credit Unions: As part of ongoing efforts to bring attention to credit union acquisitions of community banks, ICBA:
Launched targeted ads and a new website making clear to consumers that “Something’s Wrong” with credit union policy.
Encourages community bankers to use its Be Heard grassroots action center to call on Congress to hold a hearing on NCUA oversight.
Offers additional resources on its website.
