A conversation with NCUA’s Kyle Hauptman during CUNA GAC

In early March, credit union advocates from Arkansas, Oklahoma, and Texas met virtually with National Credit Union Administration Vice Chairman Kyle Hauptman. More than 130 credit union leaders attended the meeting, led by Cornerstone EVP/Chief Advocacy Officer Jim Phelps.

The pandemic was among the initial topics discussed, particularly ways organizations have adapted to doing business virtually, such as NCUA examinations.

“The pandemic has forced us to live life differently,” Hauptman said. “But some things we might want to keep, like telemedicine. How do you think it’s going now that NCUA exams has gone virtual?” 

Meeting participants chimed in with answers that were largely positive. American Airlines Federal Credit Union President and CEO Gail Enda said the credit union would be open to continuing with virtual exams but would probably need investment in technology to make the process more seamless.

Navy Army Community Credit Union Executive Vice President Dana Sisk said one benefit was that virtual exams forced everyone involved to schedule meetings for discussion, which resulted in less disruption. She added that as a best practice, her credit union established a daily 15-minute check-in call to review pending requests, concerns, and meeting needs for deep-dive discussions.

Steve Gilman, CEO of Houston Fire Fighters Federal Credit Union, said his credit union had just wrapped up a two-week exam and that it was challenging converting all the paperwork into a digital format. Gilman said he wouldn’t be surprised if virtual exams were the way forward; people just need to get used to it.

Judy Deharo, chief lending officer of FirstLight Federal Credit Union, agreed with GECU President and CEO Crystal Long about the NCUA not being willing to sign non-disclosure agreements, which necessitated workarounds. Without an NDA, FirstLight’s biggest and most time-consuming issue during its virtual exam was getting documents uploaded into NCUA’s portal.

Hauptman said his new job is very different than he thought it would be. When he was first nominated to serve on the NCUA board, the economy was healthy, but by the time he was confirmed in December 2020, the economy had been floundering since the previous April, when the country lost 20 million jobs due to the pandemic.

But Hauptman is optimistic. He said, based on NCUA data, credit unions are in good shape. Loan-to-share ratio is quite good, and the system as a whole is stable. The housing market is going strong, and Texas is looking better than the rest of the nation. But Hauptman is concerned about car loans and their effects on credit unions.

Having previously worked in Senate, Hauptman said his ability to effect change now that he’s on the NCUA board is much greater, because there are only three board members and two is a quorum. He said he doesn’t want to look back at his time at NCUA and not have done all the things he talked about doing when he worked on the Hill.

One of Hauptman’s priorities before his term is up in August 2025 is adding newly chartered credit unions, often referred to as “de novo” institutions. He wants to make it easier to start a credit union, especially in places where there are no financial institutions or people are underserved or unbanked.

“If there are no new credit unions, and all we have are mergers and failures, we need to look at new credit unions,” Hauptman said. “Americans who want credit unions near them should be able to have them.”

Hauptman believes it’s more productive to speak with those who have started and failed or stopped the process of starting a credit union to find out where the barriers are, and he suggested getting league leaders together to discuss the de novos.

“It’s our job to make sure we are not preventing people from starting a credit union,” Hauptman said. “The reason we want it to be easier is not because we need more startups; it’s because we as the regulators should not be a roadblock.”

Phelps noted that there have been only four credit unions chartered in the Cornerstone region in recent years: two in Texas and two in Oklahoma.

“It’s an arduous process and takes a lot of time,” Phelps said. “I have lamented how over the years you don’t see many credit unions being chartered and some have merged, so the numbers have dwindled. I would like to see us growing.”