Had Navy Federal Credit Union been subject to the Community Reinvestment Act, it might have avoided reputation disaster with reports of its discriminatory lending, according to a new op-ed.
New Op-ed: In American Banker, Community Development Fund Advisors President Kenneth Thomas said the credit union CRA exemption prevented stakeholders from identifying disparities and other lending problems before they got out of control. “Had Navy Federal been subject to the Community Reinvestment Act, which it opposes more than anything except federal taxes, it may have avoided this reputational disaster,” he wrote.
Not Going Away: House Financial Services Committee Democrats last week urged Chairman Patrick McHenry (R-N.C.) to hold a hearing on CNN’s reporting on discriminatory lending at Navy Federal, the latest in a series of congressional inquiries. ICBA last month urged congressional committees to convene a broader hearing on credit union lending practices and oversight following the Navy Federal report.
Third-Party Oversight: Also last week, National Credit Union Administration Chairman Todd Harper said his agency’s lack of oversight of credit union service organizations and other third-party providers is an “Achilles’ heel” for the credit union system. As ICBA has testified before Congress, it supports allowing the NCUA to directly examine and regulate CUSOs, core providers, and other third-party providers.
Grassroots Resources: Community bankers can use ICBA’s Be Heard grassroots action center to call on their members of Congress to hold a hearing on the NCUA’s lax oversight. Additional resources on credit union policy are available on the ICBA website.
