BY DENNIS CHILD
Is the small size of your credit union getting in the way of your regulatory compliance? Staying viable under the present regulatory environment is proving a challenge for many CUs. But that doesn’t mean you have to lay down the gauntlet. Outsourcing could be the key to continued operational efficiency.
There is mounting evidence that the present regulatory environment is making it almost impossible for mid-size to small credit unions to meet compliance expectations and stay in business. Regulatory burdens are harming credit unions in a couple of ways: (1) the cost of compliance is driving credit unions out of business and (2) failure to comply can result in the loss of a CEO’s job and/or the demise of a credit union. Small and mid-size credit unions particularly will need to find methods to help them cope with the growing burden of regulatory compliance if they hope to remain viable.
Credit unions under $250 million especially are struggling to sustain growth and profitability due to growing regulatory compliance requirements. They would clearly benefit from resources that are now available to help with compliance issues. Let’s look at some facts supporting these affirmations:
190 regulatory changes occur in eight years.
CUNA reports that since 2008, credit unions have been subjected to more than 190 regulatory changes from nearly three dozen federal agencies, totaling nearly 6,000 Federal Register pages.
CEOs are worried.
A 2014 survey of credit unions by CUNA indicates that regulatory burden is one of the top three worries for managers and boards.