The National Credit Union Administration, an independent federal agency that insures deposits at and regulates credit unions akin to how the Federal Deposit Insurance Corporation regulates banks, in recent months released its multi-year strategic plans that “outline the NCUA’s strategic and performance goals along with the critical factors that affect the achievement of these goals.” Monday, Jan.
Both Burgum and Jeff Olson, the CEO of the Dakota Credit Union Association, expressed concern in their public comments about a portion of the NCUA strategic plan that urged credit unions to consider diversifying their clientele if a large portion of the clientele is at risk of suffering a negative impact from climate change.
The section considers the financial impacts of climate change, including physical damages and changing regulations that could affect the viability of certain industries.
Also mentioned in the section as examples of industries that could be impacted were the energy and auto industries.
“Changing weather patterns will disproportionately affect farming communities.
In his letter, Burgum noted that North Dakota’s 34 credit unions have 214,000 members and currently hold $748 million in agricultural loans, accounting for roughly one-quarter of their loan portfolios on average.
“DakCU is very concerned for small credit unions whose field of membership only encompasses rural/agricultural communities.
In an interview Tuesday afternoon, Olson said some of his organization’s concerns already are playing out, with some credit unions in good standing that have large ag portfolios being moved from 18-month exam cycles by the NCUA to 12-month cycles.
Now that the comment period for the NCUA strategic plan has passed, Olson said the comments will be reviewed, and the NCUA board will consider endorsing it.
John Hoeven of North Dakota is the ranking member on the Senate Ag Appropriations Committee, and he said those officials can help make sure credit unions can continue doing business in agriculture.