Credit union leaders applauded congressional passage of a bipartisan effort to dismantle parts of banking rules imposed in the wake of the 2008 financial crisis. The approval of the rollback in the House of Representatives and Senate is regarded as a big victory for small and mid-size banks. Many experts believe they have been unfairly burdened by the Obama-era package of rules known as Dodd-Frank. “We lose about a credit union a day, and it’s mostly because of the regulatory burden,” Dan Berger, CEO of the National Association of Federally-Insured Credit Unions, told Cheryl Casone during a FOX Business interview on Wednesday. “It’s so expensive to deal with all of those regulations that have been promulgated. For us, this releases a lot of the burden. It’s a really good first step.” A bill was approved Tuesday by the House of Representatives, following passage by the Senate. President Donald Trump is expected to sign the bill into law on Thursday.
The rollback would ease regulation on some big banks, grant consumers the right to free credit freezes and provide relief to smaller banks by softening the Volcker Rule, which prohibits banks from making their own investments with customers’ deposits.
That could benefit credit unions by making it easier for them to allow community lenders to open banks; provide services to members via mobile apps; and protect individuals at institutions that report suspected elder financial abuse.
Going forward, Berger said he hopes Congress can recognize that credit unions aren’t the institutions responsible for starting the financial crisis and exempt them from Dodd-Frank entirely.
“We’re hoping that new credit unions will start, but for the existing ones out there, this was a tremendous bill that was passed, hopefully signed soon by President Trump into law, so new credit unions can start,” he said.