NCUA Chairman Todd M. Harper’s Remarks at the Defense Credit Union Council’s Defense Matters Webinar Forum

As Prepared for Delivery on February 25, 2021

Thanks, Tony, and hello everyone! It’s a pleasure to speak with you today.

Last month, I received the greatest honor of my career when I became the 12th NCUA Board Chairman. I’ve spent nearly a decade at the NCUA and worked on credit union policy issues for more than 20 years. My whole heart is in the mission of the NCUA and its vital work, and I look forward to leading the NCUA and working with all its stakeholders, including our military credit unions, as we:

• Respond to the economic fallout created by the pandemic,
• Position the agency for future challenges, and
• Strengthen our commitment to consumer financial protection.

Priorities and Philosophy as Chairman

The credit union system now sits at the intersection of several crossroads. For example, many of the largest credit unions continue to grow rapidly, while many smaller credit unions continue to struggle. As the COVID-19 pandemic rages on, we must smartly, pragmatically, and expeditiously address the economic fallout within the credit union system.

To that end, when I first became Chairman, I issued my Commander’s Call to the agency.

First, I laid out my priorities, which have always been:

• Capital and liquidity;
• Consumer financial protection;
• Cybersecurity; and
• Diversity, equity, and economic inclusion.

In the many months ahead, these priorities will guide the NCUA’s decisions. We also need to understand that bad actors continue to undermine the very integrity of our interconnected financial system through fraud and cyberattacks. To compete, credit unions must be able to safely and securely use technology to deliver member services and to adopt financial innovations to ensure the industry’s long-term success.

However, we must all work together to promote innovation with an emphasis on security and equity. We must also strengthen the NCUA’s consumer financial protection program to ensure that all consumers receive the same level of protection regardless of their financial provider of choice.

We must also do more to improve the financial literacy and personal finance knowledge of our service members. According to statistics from the Department of Defense, nearly 46 percent of active duty military members are 25 years old or less. This age range is when many young service members have their first experiences with the financial system, such as opening a credit union account, taking out their first car loan, or getting their first credit card. The financial decisions these individuals make can have profound implications for their financial well-being later in life and even on our military’s readiness.

Each of you can play a pivotal role in helping our service members handle all the major events in their personal financial life, from buying a home, to making the most of their GI Bill benefits, to planning for retirement. Financial regulatory agencies, non-profits, schools, military credit unions and other depository institutions must work together to improve the personal finance knowledge of service members and their families to prevent them from being financially exploited. I look forward to working with all of you on that important mission.

Overall, my regulatory philosophy can be summarized in the acronym “FIRE.” I believe that as an agency, we need to be:

• Fair and forward-looking;
• Innovative, inclusive, and independent;
• Risk-focused and ready to act expeditiously when necessary; and
• Engaged appropriately with all stakeholders to develop effective and efficient regulation.

This FIRE philosophy has been, and will continue to be, the North Star for me and the NCUA.

Economic and Social Justice

I came of age in the 1970s and 1980s. The songs of that era, along with the music of Motown, strike a chord with me, and I often find inspiration within their melodies.

Recently, I heard “The Way It Is” by Bruce Hornsby and the Range. If you listen closely, the lyrics of that song touch on the state of racial and socio-economic issues in the days following the Great Society and the civil rights movement. These lyrics are just as relevant today as they were more than a generation ago.

At its core, the credit union movement is committed to cooperative credit. And cooperative credit means making sure that credit unions live up to their mission of providing access to credit and savings to their members, including those of modest means like many recruits starting out in the military.

The NCUA, then, must do all it can to advance economic equity and justice. In the aftermath of George Floyd’s killing last year and the nationwide Black Lives Matters demonstrations, we have an obligation to address these issues directly and chart a better course for our nation’s future.

In particular, we must enhance support for minority depository institutions, low-income credit unions, and community development credit unions that are on the front lines of serving the underserved. One example of the NCUA’s support of low-income credit unions was its decision, last May, to adjust how the agency considers military postal addresses when determining if a credit union qualifies for the low-income designation. At the time, I noted that our country was in an economic war against COVID-19. Accordingly, the NCUA needed to do all it could to help federally insured credit unions serve their members, including our service members, by giving them access to more resources.

This policy change will help more credit unions that serve the military qualify for the low-income credit union designation and provide them with access to technical assistance grants and loans and other benefits that expand access to safe and affordable financial products and services.

We must also ensure compliance with fair lending laws, so people of all colors can buy a home, purchase a car, start a business or finance college without being subject to discriminatory terms. In doing so, we will lift all boats and live up to the cooperative philosophy at the heart of the credit union movement.

We must also find ways to close the wealth gap by helping people build wealth through homeownership, starting small businesses, and saving for retirement. Additionally, we must consider future challenges like climate change, which disproportionately affects underserved communities. As we address each of these issues, we can address the disparities exacerbated by the pandemic and centuries of systemic discrimination.

We obviously have lots of work ahead of us, but it is important work that can change the lives of those who rely on a military credit union to achieve their financial goals.

Thank you again for inviting me to be a part of Defense Matters. I look forward to working with all of you and seeing you in person again one day when our public health experts give the “all clear.”

Until then, be safe, be well, be kind.