A “Novel” Solution That You Can Already Use
This morning’s American Banker is reporting on a “novel” solution that banks are employing to deal with the compliance burden. It’s reporting that five community banks in Kansas are sharing the cost of hiring a compliance person. This is a great idea, but it’s not new. It’s one that the credit union industry has already been using for at least a decade. Your credit union may already be able to participate.
In New York, we have two compliance people who work with a group of credit unions to provide compliance services. One specialist is in Central New York; one is in the Western part of the State. We are currently interviewing for a third person who will work with credit unions in the Westchester-Rockland region. We got the idea from talking to our counterparts in Georgia and Texas, and I’m sure there are other states that have jumped on the bandwagon.
In New York, the Association facilitates discussions with a group of credit unions that are willing to share the cost of a compliance specialist. If there is enough interest, the Association hires a person in that region. Our compliance department is responsible for training the specialists and is always there as a backup to help with difficult questions and projects. The program provides a cost effective way for smaller credit unions to not just complain about the compliance burden but actually do something about it. It also provides larger credit unions the opportunity to use a compliance person to take on specific tasks.
Regular readers of this blog know that its purpose is not to plug credit union services. But I feel so strongly about this model that if your Association doesn’t offer to facilitate shared compliance services, you should ask it to look into it. It’s a win-win.
Big Day at the NCUA Today
Compliance specialists should be sure they have enough coffee because today could be a long one. The NCUA has scheduled a busy board meeting that will provide plenty of required reading. Most importantly, if all goes according to plan, the Board will finalize amendments to field-of-membership requirements for FCUs and have a board briefing on supplemental capital. Later today, NCUA will also be holding a budget hearing. I will try to find the best highlights for tomorrow’s blog. I bet you can’t wait.