NCUA May Miss Another Self-Imposed Deadline on Climate
The NCUA board will not discuss climate change this month as a climate-related bill impacting credit unions was introduced in the Senate. Learn why.
Agency will not consider issue at February board meeting as climate-related legislation impacting credit unions is introduced in Senate.
The NCUA board may miss another self-imposed deadline for requesting information from stakeholders about the impact that climate change may have on the credit union industry.
Initially, the board said the request for information would be issued by the end of 2022. Then, last month, board members indicated that the issue would be addressed at their February meeting.
When the agenda for that meeting was released on Thursday, it was not included as a topic to be considered.
An NCUA spokesperson said the agency is still working on the request for information.
Where the NCUA Currently Stands
The issue of climate change is a thorny one for the agency. Board Chairman Todd Harper has indicated that he believes the NCUA should examine whether credit unions are responding to the threats climate change might pose and has endorsed a proposal by the Financial Stability Oversight Council to evaluate those risks.
However, the NCUA board is currently controlled by Republicans—Rodney Hood and Kyle Hauptman, who have indicated they favor a more hands-off approach.
Harper might have more support for a stronger climate-related stance after August, when Hood’s term expires, and President Biden is able to nominate a Democrat for the board.
Last year, the Ceres Accelerator for Sustainable Capital Markets, an advocacy group, said the NCUA was behind other financial regulators in addressing the issue.
Climate-Related Bill Impacting Credit Unions
Meanwhile, on Capitol Hill, Sen. Kevin Cramer, R-N.D., and a group of 36 other Republican senators have introduced legislation that would prohibit large credit unions and banks from deciding not to provide services to politically sensitive businesses, such as those dealing with fossil fuels and firearms.
The bill, S. 293, would punish credit unions and banks with assets of more than $10 billion that refuse to do business with those companies. The legislation would disqualify those financial institutions from using discount window lending programs, terminate their status as an insured depository institution or insured credit union, or impose a civil penalty of up to $10,000 per violation.
“There is no place in our society for discrimination, and big banks and financial institutions are no exception,” Cramer said. “The Biden administration and their liberal base are weaponizing the financial system to defund, debank, or discredit industries they do not like.”