As Prepared for Delivery on March 17, 2022
Thank you for today’s presentation. As I have said previously, the strategic plan is an important document about where the agency may be heading. And while the NCUA Board does approve this plan, I must say that it is my view that the Chairman should be given more leeway to set the vision for how and where he would like to take the agency. The strategic plan is an aspirational document, and while I certainly believe that climate change is an issue, I simply do not believe it's an issue for the NCUA as a safety and soundness financial regulator at this time.
Currently, my view is that credit unions know best how to manage and mitigate the risk in their respective communities and not the NCUA. However, in the spirit of bipartisanship, I deferred to the Chairman on the climate change language in the strategic plan and I did so knowing that, again, this strategic plan, as an aspirational document, does not change any NCUA policy or supervision for climate change.
We did get many comments on this issue, including from the Governor of North Dakota, Doug Burgum. Governor Burgum said that climate-related financial risks “is ill-conceived, politically motivated, anti-agriculture rhetoric that threatens to cause serious harm to the farmers and ranchers who form the backbone of rural America.”
If the climate decision was just up to me, I would not have climate-related financial risks in the strategic plan. But it was not my decision alone. I also knew this was a top priority of Chairman Harper. And in the spirit of bipartisanship, I appreciate the language in the final strategic plan before us today that says, and I quote, “The agency does not intend to micromanage credit union lending decisions for climate financial risk, including lending to family farms and others in the agricultural sector as well as businesses tied to the fossil fuel industry. The NCUA Board underscores that nothing in this strategic plan should be construed as discouraging activities related to agriculture or fossil fuels.”
Furthermore, I have consulted with the Office of General Counsel, and as a legal matter, the Board adoption of the strategic plan does not change or alter NCUA policy and should not be interpreted by anyone to implement a future policy change. Changing policy will require a future Board action. However, nothing that I’ve said today should constrain me or, frankly, lock me into a position, one way or another, for future action regarding climate change. I’m indeed open to studying this issue more and would like to see the best public policy prevail.
I do have some questions:
- Can you discuss the ACCESS initiative in the strategic plan and any lessons learned from the recent GAO report?
- Can you highlight the significant changes to this strategic plan that were not in the last strategic plan that was approved by the Board?
Consumer financial protection is in the strategic plan. And while overdrafts are not mentioned specifically in the strategic plan, I want to speak about overdrafts fees because this has been getting lots of press coverage lately.
- Can you confirm that the overdraft data collection highlighted in the 2022 NCUA supervisory priorities letter is only a data collection effort at this point in time?
- Thank you for that. I have a yes or no question: can you confirm that overdraft programs at credit unions are not subject to examiner criticism in terms of the overdraft data collection?
- Can you confirm that any changes made to NCUA’s oversight of overdraft fees require future Board approval?
- And finally, last year as I recall, a report was due to the Board, as approved in a Board action, on consumer financial protection. That report has not been submitted under the timetable directed by the Board. While the Board has been updated on the status of this report can you please state for the record the status of this report?
Thank you. I have no further questions or comments.