Week ahead: Hauptman hearing on tap, slower recovery expected
Credit unions are set to hear this week from a new face in the industry who could have a significant impact on the movement in the years to come.
Kyle Hauptman, President Trump’s most recent nominee to the National Credit Union Administration board, will sit for a confirmation hearing this week before the Senate Banking Committee. The nominee will require full Senate confirmation, but if confirmed could serve on the board until at least August of 2025.
“If Hauptman were to be seated, it sets up an interesting dynamic if [former Vice President] Joe Biden is elected president in November,” wrote Geoff Bacino, a former NCUA board member and a partner in the Alexandria, Va.-based consultancy Bacino & Associates.
Confirmation will almost certainly ensure Republicans hold a majority on the board until at least August 2023, when Chairman Rodney Hood’s term expires, meaning the next chairman – presumably a Democrat, if Biden wins in November – would face a 2-1 margin and “could see few, if any, of their proposals come to fruition,” noted Bacino.
The Senate Banking Committee will also consider a pair of nominations to the Securities and Exchange Commission along with Hauptman’s nomination.
Beyond confirmation hearings, lawmakers this week are also scheduled to consider additional coronavirus-relief measures, though any new legislation is likely to be smaller than what was in the Coronavirus Aid, Relief and Economic Security Act. Senate Majority Leader Mitch McConnell is expected to release a package of roughly $1 trillion in relief measures sometime this week. But the clock is ticking, since the House is expected to break at the end of July and the Senate following soon after. Neither party will return until after Labor Day.
Additional measures to help consumers recover from the pandemic could be needed, according to new data from the Credit Union National Association. The trade group has revised its economic forecasting, predicting a more protracted recovery than was previously expected. With many states reversing plans to reopen, business activity is expected to be curtailed.
Credit unions are likely to see record savings growth, CUNA said, along with a “significant fall in credit union earnings” due to increased loan loss provisions and a low interest rate environment. J rates could continue to drop in the upcoming months, but at a slighter pace than previously forecasted, with jobless projections now slated to hover at 10% by year-end.
“Unfortunately we do not expect a full economic recovery until the vaccine is widely available or at least there’s some way of containing the virus, and that’s not expected until 2021 at the earliest,” said Jordan van Rijn, a senior economist at CUNA.