Chairman Michael E. Fryzel testimony on “Modernizing Bank Supervision and Regulation" before the Senate Committee on Banking, Housing and Urban Affairs.

The NCUA agrees with the need for establishing a regulatory oversight entity (systemic risk regulator) whose responsibilities would include monitoring the financial institution regulators and issuing principles-based regulations and guidance. The NCUA envisions this entity would be responsible for establishing general safety and soundness guidance for federal financial regulators under its control while the individual federal financial regulators would implement and enforce the established guidelines in the institutions they regulate. This entity would also monitor systemic risk across institution types. For this structure to be effective for federally-insured credit unions, the National Credit Union Share Insurance Fund (NCUSIF) must remain independent of the Deposit Insurance Fund to maintain the dual regulatory and insurance roles for the NCUA that have been tested and proven to work in the credit union industry for almost 40 years.