CUNA plans to work across the credit union industry to ensure the NCUA receives feedback on its alternative capital Advance Notice of Proposed Rulemaking (ANPR) put forth Thursday. The ANPR seeks information on a broad range of alternative capital topics.
“We thank the NCUA for taking the next step toward allowing credit unions to use alternative forms of capital for purposes of complying with the risk-based capital rule,” said Jim Nussle, CUNA president/CEO. “We look forward to working with the leagues, credit unions and our Examination and Supervision subcommittee to make sure the agency gets the feedback it needs to continue to move forward.
“It is vital that credit union stakeholders carefully consider the questions put forth by NCUA, and to submit their comments on the matter during the comment period,” Nussle added.
According to the NCUA, alternative capital includes two separate categories: secondary capital and supplemental capital.
Secondary capital is currently permissible only for low-income designated credit unions to issue and to be counted toward both the net worth ratio and the risk-based net worth requirement. The board is considering changes to this.
There are no other forms of alternative capital currently authorized.
The board is also considering whether or not to authorize credit unions to issue supplemental capital instruments that would only count towards the risk-based net worth requirement.
Topics addressed in the ANPR include:
The ANPR poses a number of specific questions on these and other topics, but invites comments on any and all aspects of alternative capital, according to the NCUA.
Comments are due to the NCUA within 90 days of the ANPR’s publication in the Federal Register.
Also at Thursday’s meeting, the NCUA board received a briefing on the statutory inflation adjustment to civil money penalties. An interim joint final rule was sent to the Federal Register Jan. 6, and will have a 30-day comment period.
More information on Thursday’s meeting can be found on CUNA’s Removing Barriers Blog.