The NCUA's initiative, now chaired by Deborah Matz, to schedule town hall meetings is a positive first step.
Credit unions are used to meetings, even with the regulator. Frequently credit union leaders go as spectators trying to decide which speech they thought best or which breakout session will be most useful. That approach must change if credit unions and NCUA are to begin to close the chasm that now exists.
Preparation is Key:
According to the agenda for the September Clayton, MO. meeting, the total time together is four hours and 30 minutes plus one hour for lunch. At present, three hours is for dialogue. Three presentations by NCUA personnel open the meeting.
To be productive in the time allowed, attendees should think carefully about their remarks. Advance preparation, including handouts, are probably wise. Otherwise the discussion can become framed by speakers and real issues never raised.
Certainly key facts are missing that would be useful to have as part of these conversations. There are no audits yet available for the NCUSIF, the CLF, the NCUA's operating fund or US Central for December 30, 2008. These audits are essential to understanding current events. While drafts of the proposed corporate rule are being circulated internally, none of these details are public.
Setting the Framework for dialogue:
So what are the critical issues that credit unions may wish to raise? What facts and issues will be useful for the new Chair to hear as she evaluates NCUA policies?
The following are suggestions from recent commentaries on events:
- What was the impact of NCUA's January and March NCUSIF loss estimates on your credit union's 2009 plans, your willingness to lend, and your growth objectives?
- How did the timing of these announcements affect your 2009 budgeted goals?
- How have subsequent announcements of the escalating costs and required expense write-offs affected your ability to make loans to members?
- How have the actions by NCUA in 2009 influenced your board's willingness to invest in a future corporate system?
- What can NCUA do to improve transparency and confidence in NCUA's actions such as the conservatorships and estimates of NCUSIF losses?
- How can the collective resources owned by credit unions in the CLF and NCUSIF be used more constructively by credit unions experiencing financial hardship?
- Can the countercyclical role credit unions have played in granting record levels of loans during the past 18 months be better supported by examiners and NCUA policy?
I believe the most effective comments will first document the impact of NCUA's actions on the credit union and then how NCUA can better align its policies with credit union's mission of serving members in a time of economic hardship.
Prepare, Prepare, and Prepare Again
The benefit of an open meeting is to increase NCUA awareness of credit union circumstances from the perspective of the grassroots. If done well, these meetings can supersede the formal rule making and lobbying positions and show the incredible power of a cooperative system working on common goals from a common vision.
For this to happen, credit unions must prepare. Document your facts, share your experiences, be specific in your suggestions about what you believe needs to be done. This is a rare opportunity for the credit union system to rediscover and state the cooperative values and mission for which everyone shares responsibility.