Federal Register Notices > Federal Register Notice - July 20, 2004
Federal Register Notice - February 04, 2004 (Volume 69, Number 23) [Proposed Rules][Pages 5300-5302] |
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NATIONAL CREDIT UNION ADMINISTRATION
12 CFR Chap. VII
Request for Burden Reduction Recommendation; Consumer Protection:
Lending-Related Rules; Economic Growth and Regulatory Paperwork
Reduction Act of 1996 Review
AGENCY: National Credit Union Administration.
ACTION: Proposed rule; notice of regulatory review; request for
comments.
SUMMARY: The NCUA Board is continuing its review of its regulations to
identify outdated, unnecessary, or unduly burdensome regulatory
requirements imposed on federally-insured credit unions pursuant to the
Economic Growth and Regulatory Paperwork Reduction Act of 1996
(EGRPRA). Today, NCUA requests comments and suggestions on ways to
reduce burden in rules we have categorized as Consumer Protection:
Lending-Related Rules, consistent with our statutory obligations. All
comments are welcome.
We specifically invite comment on the following issues: Whether
statutory changes are needed; whether the regulations contain
requirements that are not needed to serve the purposes of the statutes
they implement; the extent to which the regulations may adversely
affect competition; the cost of compliance associated with reporting,
recordkeeping, and disclosure requirements, particularly on small
credit unions; whether any regulatory requirements are inconsistent or
redundant; and whether any regulations are unclear.
We will analyze the comments received and propose burden reducing
changes to our regulations where appropriate. Some suggestions for
burden reduction might require legislative changes. Where legislative
changes would be required, we will consider the suggestions in
recommending appropriate changes to the Congress.
DATES: Comment must be received on or before May 4, 2004.
ADDRESSES: Direct comments to Becky Baker, Secretary of the Board. Mail
or hand-deliver comments to: National Credit Union Administration, 1775
Duke Street, Alexandria, Virginia 22314-3428. Fax comments to (703)
518-6319. E-mail comments to regcomments@ncua.gov.
Please send comments by one method only. Because of the number of regulatory matters for
which NCUA may be receiving comments during the time this comment
period is open, we suggest commenters identify comments in response to
this notice by including ``EGRPRA'' in a subject or reference line in
their comments.
FOR FURTHER INFORMATION CONTACT: Ross P. Kendall, Staff Attorney,
Office of General Counsel, at the above address or telephone (703) 518-
6562.
SUPPLEMENTARY INFORMATION:
I. Introduction
NCUA seeks public comment and suggestions on ways it can reduce
regulatory burdens consistent with our statutory obligations. Today, we
request input to help us identify which Consumer Protection--Lending
Related rules are outdated, unnecessary, or unduly burdensome. The
rules in this category are listed in a chart at the end of this notice.
The EGRPRA review supplements and complements the reviews of
regulations that NCUA conducts under other laws and its internal
policies.
In drafting this notice, the NCUA participated as part of the
EGRPRA planning process with the Office of the Comptroller of the
Currency, Board of Governors of the Federal Reserve System, Federal
Deposit Insurance Corporation, and Office of Thrift Supervision
(Agencies). Because of the unique circumstances of federally-insured
credit unions and their members, NCUA is issuing a separate notice from
the other Agencies, which are issuing a joint notice. NCUA's notice is
consistent and comparable with the joint notice published by the other
Agencies, except on issues that are unique to credit unions.
This notice includes several regulations that affect credit union
lending activity that are issued by the Board of Governors of the
Federal Reserve System (Federal Reserve): Equal Credit Opportunity, 12
CFR part 202 (Regulation B), Home Mortgage Disclosure, 12 CFR part 203
(Regulation C), Consumer Leasing, 12 CFR part 213 (Regulation M) and
Truth in Lending, 12 CFR part 226 (Regulation Z). These regulations are
also included in the Agencies' joint notice in which the Federal
Reserve is participating. The NCUA has enforcement authority for
federal credit unions for Regulations B, M, and Z and for both federal
credit unions and federally-insured state chartered credit unions for
Regulation C. Credit unions and other interested parties seeking to
comment on these rules may either submit comments to the NCUA or the
EGRPRA Web site, at www.EGRPRA.gov,
as specified in the joint notice.
Commenters may address any aspect of the regulations, including
specifically how the regulations uniquely affect credit unions.
II. A. The EGRPRA Review Requirements and NCUA's Proposed Plan
This notice is part of the regulatory review required by section
2222 of EGRPRA.
\1\ The NCUA described the review requirements in our
initial Federal Register notice, published on July 3, 2003.
\2\ As we
noted at that time, we anticipate that the EGRPRA review's overall
focus on the ``forest'' of regulations will offer a new perspective in
identifying opportunities to reduce regulatory burden. We must, of
course, assure that the effort to reduce regulatory burden is
consistent with applicable statutory mandates and provides for the
continued safety and soundness of federally-insured credit unions and
appropriate consumer protections.
\1\ Pub. L. 104-208, div. A, title II, sec. 2222, 110 Stat.
3009-414; codified at 12 U.S.C. 3311.
\2\ 68 FR 39863.
The EGRPRA review required that NCUA categorize our regulations by
type. Our July 3, 2003, Federal Register publication identified ten
broad categories for our regulations. The categories are:
1. Applications and Reporting
2. Powers and Activities
3. Agency Programs
4. Capital
5. Consumer Protection
[[Page 5301]]
6. Corporate Credit Unions
7. Directors, Officers and Employees
8. Money Laundering
9. Rules of Procedure
10. Safety and Soundness
To spread the work of commenting on and reviewing the categories of
rules over a reasonable period of time, we proposed to publish one or
more categories of rules approximately every six months between 2003
and 2006 and provide a 90-day comment period for each publication. We
asked for comment on all aspects of our plan, including: The
categories, the rules in each category, and the order in which we
should review the categories. Because the NCUA was eager to begin
reducing unnecessary burden where appropriate, our initial notice also
published the first two categories of rules for comment (Applications
and Reporting and Powers and Activities). All our covered categories of
rules must be published for comment and reviewed by the end of
September 2006.
The EGRPRA review then requires the Agencies to:
(1) Publish a
summary of the comments we received, identifying and discussing the
significant issues raised in them;
and (2) eliminate unnecessary
regulatory requirements. Within 30 days after the Agencies publish the
comment summary and discussion, the Federal Financial Institutions
Examination Council, which is the formal interagency body to which all
of the Agencies, including the NCUA, belong, must submit a report to
the Congress. This report will summarize significant issues raised by
the public comments and the relative merits of those issues. It will
also analyze whether the appropriate federal banking agency can address
the burdens by regulation, or whether the burdens must be addressed by
legislation.
B. Public Response and NCUA's Current Plan
NCUA received eight comments in response to its first notice. The
comments have been reviewed and an ongoing analysis of them is
underway. The comments have been posted on the interagency EGRPRA Web
site www.EGRPRA.gov \
and can be viewed by clicking on ``Comments.'' We are actively reviewing the
feedback received about specific ways to reduce regulatory burden, as well as
conducting our own analyses. Because the main purpose of this notice is to request
comment on the next category of regulations, we will not discuss specific
recommendations about the first set of regulation categories here.
However, as we develop initiatives to reduce burden on specific
subjects in the future--whether through regulatory, legislative, or
other channels--we will discuss the public's recommendations that
relate to our proposed actions.
In our last notice, we requested comment about our proposed
categories and placement of the rules within each category. Persons
commenting on the joint notice published by the other Agencies last
June observed that commenting on the Consumer Protection category would
be burdensome in itself, and suggested that we might receive more
useful feedback if the category was divided. As a result, both NCUA and
the other Agencies have divided the consumer protection regulations
into two categories:
(1) Lending-Related Rules, and
(2)
Share Account--
Deposit Relationships and Miscellaneous Consumer Rules. The regulations
in the Lending-Related Rules category are listed in the chart below.
The Share Account--Deposit Relationships and Miscellaneous Consumer
Rules category will contain the remaining rules previously identified
in the Consumer Protection category. We plan to request comment on the
Share Account--Deposit Relationships and Miscellaneous Consumer Rules
in the next notice.
We also requested comment about the order we should review the
categories. According to some industry representatives, the
requirements imposed by the Consumer Protection regulations are among
the most burdensome. Given this response, we will focus on those rules
first.
III. Request for Comment on Consumer Protection: Lending Related Rules
Category
NCUA is asking the public to identify the ways in which the
Consumer Protection: Lending Related rules may be outdated,
unnecessary, or unduly burdensome. If the implementation of a comment
would require modifying a statute that underlies the regulation, the
comment should, if possible, identify the needed statutory change. The
rules in this category are listed in the chart below.
We encourage comments that not only deal with individual rules or
requirements but also pertain to certain product lines. For example, in
the case of a particular loan, are any disclosure requirements under
one regulation inconsistent with or duplicative of requirements under
another regulation? Are there unnecessary records that must be kept? A
product line approach is consistent with EGRPRA's focus on how rules
interact, and may be especially helpful in exposing redundant or
potentially inconsistent regulatory requirements. We recognize that
commenters using a product line approach may want to make
recommendations about rules that are not in our current request for
comment. They should do so since the EGRPRA categories are designed to
stimulate creative approaches rather than limiting them.
Specific issues to consider. While all comments are welcome, NCUA
specifically invites comment on the following issues:
- Need for statutory change. Do any of the
statutory requirements underlying these regulations impose redundant,
conflicting or otherwise unduly burdensome requirements? Are there less
burdensome alternatives?
- Need and purpose of the regulations. Are the
regulations consistent with the purposes of the statutes that they
implement? Have circumstances changed so that the regulation is no
longer necessary? Do changes in the financial products and services
offered to consumers suggest a need to revise certain regulations (or
statutes)? Do any of the regulations impose compliance burdens not
required by the statutes they implement?
- General approach/flexibility. Generally, is
there a different approach to regulating that NCUA could use that would
achieve statutory goals while imposing less burden? Do any of the
regulations in this category or the statutes underlying them impose
unnecessarily inflexible requirements?
- Effect of the regulations on competition. Do any
of the regulations in this category or the statutes underlying them
create competitive disadvantages for credit unions compared to another
part of the financial services industry?
- Reporting, recordkeeping and disclosure
requirements. Do any of the regulations in this category or the
statutes underlying them impose particularly burdensome reporting,
recordkeeping or disclosure requirements? Are any of these requirements
similar enough in purpose and use so that they could be consolidated?
What, if any, of these requirements could be fulfilled electronically
to reduce their burden? Are any of the reporting or recordkeeping
requirements unnecessary to demonstrate compliance with the law?
- Consistency and redundancy. Do any of the
regulations in this category impose inconsistent or redundant
regulatory requirements that are not warranted by the purposes of the
regulation?
[[Page 5302]]
- ET Clarity. Are the regulations in this category
drafted in clear and easily understood language?
- Burden on small insured institutions. NCUA has a
particular interest in minimizing burden on small insured credit unions
(those with less than $10 million in assets). More than half of
federally-insured credit unions are small--having $10 million in assets
or less--as defined by NCUA in IRPS 03-2. NCUA solicits comment on how
any regulations in this category could be changed to minimize any
significant economic impact on a substantial number of small credit
unions.
- NCUA appreciates the efforts of all interested parties to help us
eliminate outdated, unnecessary or unduly burdensome regulatory
requirements.
IV. Regulations About Which Burden Reduction Recommendations Are
Requested Currently
Consumer Protection: Lending Related Rules
Nondiscrimination Requirement (Fair Housing)................12 CFR 701.31.
Loans in Areas Having Special Flood Hazards.................12 CFR part 760.
Credit Practices[Federal Reserve Rules]......................12 CFR part 706.
Equal Credit Opportunity [Regulation B]......................12 CFR part 202.
Home Mortgage Disclosure [Regulation C]......................12 CFR part 203.
Consumer Leasing [Regulation M]..............................12 CFR part 213.
Truth in Lending [Regulation Z]..............................12 CFR part 226.
By the National Credit Union Administration Board on January 28,
2004.
Becky Baker,
Secretary of the Board.
[FR Doc. 04-2279 Filed 2-3-04; 8:45 am]
BILLING CODE 7535-01-P
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