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Vice Chairman Hood Addresses the FDIC Conference on Affordable, Responsible Loans for the Military

December 6, 2006, Alexandria, VA – National Credit Union Administration (NCUA) Vice Chairman Rodney E. Hood addressed the Federal Deposit Insurance Corporation (FDIC) in Washington, D.C. The conference, titled, “Affordable, Responsible Loans for the Military”, focused upon building profitable, long term, multiple-account banking relationships through affordable credit and providing a better alternative to high cost, non-bank, financial service providers often found surrounding military bases. Vice Chairman Hood was joined by officials from the private and public sector, including: Sheila C. Bair, Chairman, FDIC; Congressman Barney Frank, incoming Chairman of the House Financial Services Committee; and Major General Andrew M. Egeland, Jr., USAF (Ret.), President and CEO, Association of Military Banks of America.

Vice Chairman Hood opened by recognizing and commending Chairman Bair as well as the countless dedicated professionals at the FDIC for “taking steps to protect the brave men and women who keep America safe.” 

Credit unions play a pivotal role in providing hardworking people with the affordable financial products they need to achieve the American dream of homeownership. Hood emphasized the necessity for our military-affiliated credit unions to work especially hard in reaching young men and women in uniform before they are introduced to predatory lenders…”the most unscrupulous financial service providers place their shell offices near military bases. These fringe providers of capital have no desire to help our enlisted members achieve economic empowerment.”

Our enlisted men and women are able to enter the financial mainstream by having access to affordable loans, financial literacy, and hope due largely to the tireless work of credit unions. Hood took the time to acknowledge and thank Mr. Arty Artega for his work on behalf of the Defense Credit Union Counsel as well as Mr. Andy Egeland for his work with the Association of Military Banks of America, noting the fact that “credit unions and military banks are exploring opportunities to share a common agenda in helping provide affordable products to our military personnel.”

Emphasizing the importance of financial education and knowing what options are available, Hood highlighted the differences between “mainstream lenders” and “fringe lenders” as well as one of many resources available to assist in foreclosure prevention.  “NeighborWorks America has launched a new Foreclosure Prevention initiative across America to help families sustain their dream of homeownership.”

The Vice Chairman identified his goal as a regulator “to ensure that credit unions have the regulatory flexibility they need to serve their members effectively. I believe that we must manage, not avoid, risks. This can be accomplished with regulation that is effective as opposed to excessive.” 

In closing, Hood conveyed to the audience the importance of working together…”As you all diligently examine financial products and services to combat predatory lending, it is imperative that financial regulators and stakeholders work together in crafting user-friendly and flexible policies that do not produce any unintended consequences for banks, credit unions, and the very group we are trying to protect – those individuals who have devoted their lives to preserving American democracy.”

For more information on protection from predatory lending, please access the brochure available on the NCUA website at: http://www.ncua.gov/Publications/brochures/PredatoryLending/PredatoryLendingBrochure.pdf. A Spanish version is available at: http://www.ncua.gov/Publications/brochures/PredatoryLending/preditorylendingbrochurespanish.pdf

The National Credit Union Administration is the independent federal agency that regulates, charters and supervises federal credit unions. NCUA, with the backing of the full faith and credit of the U.S. government, also operates and manages the National Credit Union Share Insurance Fund (NCUSIF), insuring the deposits of over 85 million account holders in all federal credit unions and the majority of state-chartered credit unions.