The NCUA Budget Process: Part 5...

Digging deeper.

Yesterday's post provided a brief synopsis of the written responses [here's the link to all] presented to the NCUA Board concerning the Agency's proposed budget.  The limited number of comments - only a dozen in total - could signal that the comment process, while diplomatic, is basically a waste of NCUA's time and resources. A tempestuous teapot, much ado about little at all?

Retaliation?
Nah, never happen.

Or perhaps credit unions are relying on their trade associations to represent their interests and present the case for budget reform on their behalf - "politically" much safer and economically far more efficient.

If so, it would appear that NAFCU was the hands-down winner [here's the link] in structuring a well-organized and succinct trade association comment letter. (Even "looks professional"!)

Take a look at the following two charts from Mr. Dan Berger's comment letter... 

NCUA's budget has basically "doubled"(up 100%!) from $150 million to over $300 million since 2008.

Most of that increase in cost since 2008 is the direct result of adding over 300 new employees (up by 1/3rd!) 

Since 2008 the number of existing credit unions has declined by 25% (dropping from 8,000 to less than 6,000!)

NCUA was well-justified in "bulking up" personnel as the result of the 2008 economic collapse; but balance sheet strength and capital are now fully restored. Yet we still have "810 examiners"... (many now in "make work" mode!) 

The NCUA senior staff is desperately attempting to link their exploding budget (which is dominated by salary and benefit costs) to the asset size of the industry, rather than the number of operating credit unions. Scheduling spending, allocating staffing, and structuring the NCUA according to the asset size of credit unions is, for the most part, sheer nonsense...

Size matters?

 ... unless the NCUA senior staff has decided to unilaterally repeal the economic principle of "economies of scale". (... and they may well have!)

What would you suggest to the NCUA Board?

ACCOUNTABILITY - COMPETENCY - TRANSPARENCY
[ACT!]