
MDIs, wildfires top of mind for shifting NCUA board
Todd Harper, who was likely serving as the agency’s board chairman for the final time, said he is extremely proud of the regulator’s accomplishments during the past four years.
The National Credit Union Administration board unanimously approved its annual performance plan for 2025, which includes an increased focus on minority depository institutions.
The NCUA defines MDIs as federally insured credit unions in which a majority of the current members, board of directors and the communities they services fall within any of the eligible minority groups.
NCUA Vice Chairman Kyle Hauptman said at the agency’s monthly board meeting Thursday that although the plan is substantially similar to the 2024 plan, there are a few performance indicators of note around supporting the viability of credit unions.
“You do not expect big hairy audacious goals in most government plans, but growing the number of members in MDI-designated credit unions by 20% over 2024 year-end levels is notable,” he said.
Conducting small credit union and MDI-assistance support for 100% of participating credit unions is also notable, Hauptman added.
The NCUA’s annual performance plan, in concert with the agency’s budget, outlines the resources and strategies the regulator will use to set priorities and manage performance.
NCUA Chairman Todd Harper said the plan includes a provision to insure the updated MDI preservation program, which was approved last year, will be another metric used in planning.
Harper said many MDIs that are also designated as low-income credit unions, which represents about 80% of MDIs, have higher net interest margins than their peers “which shows that a minority depository institution focusing on a niche market can really help a community to thrive,” he said.
Board member Tanya Otsuka said the NCUA should continue to support the growth of MDIs. Nearly 500 MDIs served more than 6.5 million members in 2023, a 26% increase from 5 million members in 2022, she said.
During that same timeframe, total loans outstand among MDIs grew by more than 40% and commercial and business lending increased by almost $1 billion.
“It’s a good sign that we are seeing more credit unions designate as MDIs,” she said. “So our preservation plan should propel this positive growth.”
On a separate topic, Harper addressed the wildfires burning in California. He said at least one NCUA examiner is homeless due to the fires.
All of the NCUA employees stationed in Los Angeles County are safe though, he said.
Roughly 38 credit unions have 58 facilities located in the impacted areas, and Harper said two federal credit unions were initially evacuated and some branches remain closed due to power outages or poor air quality.
He said NCUA staff will soon receive training on helping credit unions to manage loan portfolios that may be adversely affected by the fires.
In what was probably his final meeting leading the board, Harper said that serving as the twelfth NCUA chairman has been one of the greatest honors of his life.
President Joseph Biden designated him as chairman on Jan. 20, 2021.
“Together, we made the credit union system safer and more resilient,” Harper said.
It is likely that Hauptman, a Republican, will be selected to serve as acting NCUA chairman by incoming President Donald Trump, although Hauptman’s tenure is set to end in August.
Hauptman said he believes the NCUA board is not as partisan as governmental boards often tend to be.
“I could point you to many other regulators – some of which are in the financial space – where the ‘R’ and ‘D’ difference is more glaring,” he said. “And I think we’re going to continue in that spirit.”
“Together, we made the credit union system safer and more resilient.”
– Todd Harper
Chairman
NCUA