A New Regulatory Era: Early Signals and What They Mean for Credit Union Leaders

As 2024 came to a close, Endurium Advisors outlined six likely outcomes for financial institutions under the incoming administration. While much of the national conversation has focused on banks, the implications for credit unions are equally significant. In some cases, uniquely consequential.

Credit unions sit at the intersection of community mission and financial stewardship. When Washington shifts its regulatory posture, credit unions must interpret not only what is permitted, but what is sustainable, and aligned with member value.

Now that early regulatory actions and leadership appointments are taking shape, we can assess how our predictions are unfolding and what they mean for credit union leaders navigating this new environment.

1. Capital Relief for Banks Will Reshape the Competitive Landscape for Credit Unions

Our original projection focused on banks gaining capital flexibility. This is happening and it matters for credit unions.

While credit unions are not subject to the same Tier 1 capital rules, bank capital relief increases competitive pressure:

• Banks will have more room to lend aggressively.
• Pricing competition may intensify in mortgages, autos, and small business lending.
• Larger banks may pursue expansion into markets traditionally served by credit unions.

Implication for credit unions:
You may not receive direct capital relief, but you will feel the downstream effects. Strategic pricing discipline, member centric product design, and balance sheet resilience become even more essential.

2. Deregulatory Leadership at Federal Agencies Will Influence NCUA’s Posture

We predicted that new leadership at OCC, CFPB, and FDIC would shift oversight toward a lighter touch. Leadership changes have occurred at the OCC and FDIC, and interim leadership is in place at the CFPB. These changes align with the administration’s broader push for deregulation in financial services, including lighter oversight and greater crypto integration.

While NCUA is independent, it does not operate in a vacuum. Historically, NCUA’s supervisory posture tends to move directionally with the broader regulatory climate.

What this could mean:

• A more collaborative, less punitive examination environment
• Potential easing of certain compliance expectations
• Greater openness to innovation and field of membership flexibility

Implication for credit unions:
This is a moment to advance strategic initiatives that may have felt constrained in a heavier regulatory environment, but with disciplined governance to avoid overreach.

3. A Pro Growth Federal Agenda Creates Both Opportunity and Pressure

We projected that a progrowth agenda would benefit financial institutions broadly. That is proving true.

For credit unions, the growth environment presents a dual reality:

• Opportunity: Rising loan demand, stronger consumer confidence, and more room to expand member services.
• Pressure: Banks with new regulatory freedom may compete more aggressively for the same borrowers and deposits.

Implication for credit unions:
Growth is available, but it must be pursued with strategic clarity. Member loyalty, community presence, and service differentiation become competitive leverage to grab market share.

4. Innovation Investment Becomes a Strategic Imperative, Not a Luxury

We predicted that reduced regulatory friction would allow banks to invest more heavily in technology and innovation. That dynamic is emerging quickly.

For credit unions, the stakes are different:

• Banks will accelerate digital transformation.
• Fintech partnerships will expand.
• Consumer expectations will rise accordingly.

Implication for credit unions:
Innovation is no longer optional. Whether through collaboration, CUSOs, shared services, or targeted investments, credit unions must modernize member experience to remain competitive. Read More: Practical Ways Small & Mid‑Size Credit Unions Can Activate Innovation

5. Competition and Consolidation Will Increase and Credit Unions Will Feel It

We forecasted heightened competition and potential consolidation in the banking sector. The early regulatory posture supports that prediction.

For credit unions, this means:

• More aggressive bank competition in local markets
• Potential opportunities to acquire branches or portfolios
• Increased pressure to scale through collaboration or merger

Implication for credit unions:
Strategic partnerships, selective consolidation, and operational efficiency will become more important as the competitive field shifts.

6. Profitability Dynamics Will Shift as Tax Policy Evolves

We predicted that changes to corporate tax policy could boost bank profitability. While tax legislation is still developing, the direction is clear: banks may gain additional financial advantages.

Credit unions, as taxexempt cooperatives, will not benefit directly — but they will compete against institutions that do.

Implication for credit unions:
Margin pressure may intensify. Credit unions will need to lean into their cooperative model — member value, trust, and service — to maintain competitive strength.

The Strategic Imperative for Credit Union Leaders

The early months of the administration confirm a decisive shift toward deregulation, capital flexibility, and progrowth policy. For credit unions, this creates a landscape defined by:

• More competition from banks with new strategic freedom
• Greater opportunity to innovate and expand member value
• A regulatory environment that may be more flexible — but still requires disciplined governance
• A need to differentiate through mission, service, and community presence

In short, credit unions are entering a moment of both challenge and possibility. Those that respond with agility and a membercentric strategy will not only navigate the transition, but they can also help shape the next chapter of cooperative finance. Endurium’s deep credit union expertise can help leaders design and execute a roadmap that delivers resilient, sustainable success.