In Her Own Words: Deborah Matz Discusses Key Industry Issues

Deborah Matz testified before the Senate Banking, Housing and Urban Affairs Committee regarding her nomination to NCUA Chair. Here are excerpts from her submitted and oral testimony on what she considers some key issues the industry is facing.

On the Corporate Credit Union Crisis

“Recently, as I know you are aware, corporate credit unions experienced problems with mortgage-backed securities that significantly affected their balance sheets. This necessitated the conservatorship, by NCUA, of the two largest corporates, U.S. Central and WesCorp. While the severe economic downturn which propelled the corporate credit union crisis was not predictable, there are steps that could have been taken which might have mitigated or prevented its effect on these institutions.”

“I mention this to underscore my view of the role of a regulator as someone who listens, gets the facts and makes independent judgments. If I am confirmed and assume the Chairmanship, I will apply these principles as NCUA begins a new round of corporate rulemaking to address the current problems.”

“The stress and uncertainty of the corporate situation has been difficult for the credit union industry. However, Congress has encouraged credit unions to continue to offer quality products to consumers. I want to echo that desire — credit unions have proven throughout their history to be the consumer’s best friend. If confirmed as their regulator, I hope to establish a strong working partnership with the industry while maintaining the critical arms length relationship between a regulator and the regulated.”

On the Corporate Stabilization Plan

“The corporate credit union stabilization fund which was initiated by this committee and signed into law in May, I believe, has gone a long way towards stabilizing the credit union system. It’s permitted NCUA to assess credit unions over the course of seven years instead of in one lump sum and that’s been a tremendous assistance to the entire system. I think that was a very necessary step.”