It will be two years in April since the National Credit Union Administration had a full board, and that seems unlikely to change for at least a few more months.
The board has been operating with only two of its three seats occupied since April 2016, when former Chairman Debbie Matz stepped down. But in actuality, two new members need to be appointed because board member Rick Metsger's term expired in August 2017. He remains on the board only until a replacement is confirmed.
President Trump designated J. Mark McWatters as chairman of the NCUA board in June 2017. His term expires in August 2019.
In an interview during the Credit Union National Association's Governmental Affairs Conference this week in Washington, former NCUA Chairman Michael Fryzel said he is surprised the seats remain vacant. Fryzel served as the lead on Trump's NCUA transition team and said the primary reason for the delay has been the number of federal appointments that needed to be made.
"The NCUA has never been a top priority," he said.
The game plan now is to have nominations for both seats in place by the second quarter and perhaps have the spots filled by June. Fryzel said the terms for both of those board members will likely run in tandem. In order to get the Republican nominee confirmed there will probably need to be a nominee for the Democratic seat at the same time, he said.
McWatters is a Republican and Metsger is a Democrat. Both, by all outward appearances, seem to be working together well and getting things done. Fryzel said if that were not the case, McWatters might ask the White House to speed up the process to add a third member to the board to break ties.
Geoff Bacino, a credit union consultant and a former NCUA board member, said the lack of appointments is partly because it always takes a new administration some time to get its "sea legs," and the Trump administration is different than any in the recent past. He said he's been told some candidates have been vetted and approved by staff only to be rejected by the President.
Bacino said the number of overall appointments is down significantly from where they were at this point with other administrations. He agreed with Fryzel that the NCUA is simply not a priority. "I don't know if credit union people like hearing this, but we are not high on the food chain," he said.
Another factor is that McWatters remains on the short list of candidates for Consumer Financial Protection Bureau director. Some attendees at the CUNA conference believe that is why McWatters extended an olive branch to bankers during his speech there, saying community banks and credit unions could benefit from a "come now and let us reason together" approach.
Bacino said if McWatters got the CFPB position it would likely create a whole different set of nominees for the NCUA board seats, because there are several people who would be interested in the chairmanship but not necessarily in another board position.
That would also lead to Trump, for the first time in history, being able to name all three NCUA board members at the same time.
In terms of the Democratic seat, Bacino said Senate Minority Leader Chuck Schumer, D-N.Y., likely has candidates that he favors, but they might not meet approval from Republicans. "And that kind of starts a bit of a standoff," he said.
Metsger said at the conference that it would "likely" be his last time there as a board member, but Bacino said Metsger could probably stay on if he wanted to.
Matz' term expired in 2015, meaning her replacement's term will expire in 2021. So the new board member taking that seat in effect has already lost the first two years. "So people have to look at their family life and wonder if it's worth it," Bacino said.
Both Fryzel and Bacino have seen their names floated as possible board members. Fryzel said he would be open to the possibility but added that he is not pushing for it. Bacino said he has been approached by the White House and by people who are involved in the nomination process.
Fryzel said there has been some speculation that the NCUA could be rolled into the Treasury Department but he does not believe that will happen anytime soon. "But then again the president always says he wants to make government as lean and efficient and small as possible," he said.
