trending Market Intelligence /marketintelligence/en/news-insights/trending/nexldmmfjgqsqjxmifmq-g2 content esgSubNav
In This List

Weekly Recap — NCUA moves forward with additional payday lending option

Podcast

Street Talk Episode 87

Blog

A New Dawn for European Bank M&A Top 5 Trends

Blog

Insight Weekly: US banks' loan growth; record share buybacks; utility M&A outlook

Blog

Banking Essentials Newsletter 2021: December Edition


Weekly Recap — NCUA moves forward with additional payday lending option

The weekly recap features news on regulatory actions, mergers and other issues facing the credit union space. Send tips, ideas and chatter to ken.mccarthy@spglobal.com.

In the spotlight

Mergers was a topic on the minds of many credit union leaders who attended the Pennsylvania Credit Union Association's annual convention last week in Farmington, Pa. Among institutions that have completed multiple deals recently was Beaver, Pa.-based West-Aircomm FCU.

The $228.6 million-asset credit union merged with Beaver County Times FCU earlier this year after completing a deal with Duq Lite Employees FCU in 2017. In an interview during the conference, CEO Lynn Stephenson said the credit union is open to taking on additional small credit unions that might be struggling with compliance burdens or competition, but West-Aircomm is not actively pursuing mergers.

Stephenson, who was promoted to CEO about 16 months ago, said both of the recently acquired credit unions were very small and did not offer many of the products and services that West-Aircomm does. "They basically had shares and loans, and when I say loans I mean just car loans and unsecured loans," she said.

In other news

* The U.S. House of Representatives voted 258-159 to pass a bill that would revise large swaths of the Obama-era banking regulatory law known as Dodd-Frank. The House vote May 22 on S.2155 was the final hurdle for a yearslong push from congressional Republicans and a handful of moderate Democrats to pare back regulations on community banks, although some argue that the bill offers too many concessions for large regional banks. President Donald Trump signed the legislation into law May 24.

* The National Credit Union Administration approved 43 credit union mergers in the first quarter. This was down from 47 mergers in the previous quarter and 44 in the first quarter of 2017. The merging credit unions had a combined $818.8 million in assets at the time their respective mergers were approved, according to the NCUA.

* The NCUA wants to give credit unions another loan option to offer their members in the rapidly growing payday lending line. At the end of 2017, 518 federal credit unions reported 190,000 outstanding payday alternative loans, or PALs, with an aggregate balance of $13.3 million, the NCUA said. At its May 24 meeting, the NCUA board approved a notice of proposed rulemaking that could result in a second version of its payday alternative loan program. The proposal would not replace the current rule, which was adopted in 2010, but instead give credit unions another option for offering short-term credit.

* Total U.S. credit union membership has been on a steady upward trajectory for years, and that trend continued in the first quarter as the industry grew to 114.1 million members. That represented year-over-year growth of 4.3%. A year ago, total credit union membership stood at 109.4 million. Navy FCU, the largest U.S. credit union by assets, added 776,111 members over the past four quarters, marking the biggest year-over-year increase in the nation.

* The Credit Union National Association has asked the Consumer Financial Protection Bureau to turn over examination authority for consumer protection regulations for the largest credit unions to the NCUA and/or the appropriate state regulator. In a May 21 letter to the CFPB, CUNA said such a move would streamline the examination and enforcement efforts for credit unions above $10 billion in assets.