WASHINGTON (6/13/14)--Commending current National Credit Union Administration board member Michael Fryzel, the Credit Union National Association said taking action on the nomination of J. Mark McWatters to the NCUA board is "critical." Some key sources have indicated the Senate could vote on his nomination soon.
CUNA's letter, sent to Sens. Harry Reid (D-Nev.) and Mitch McConnell (R-Ky.) Thursday, urged the Senate to schedule a vote on McWatters soon so the board has a full contingent as it considers comments on its risk-based capital (RBC) proposal, conducts "Listening Sessions" in the next several weeks and moves toward developing a final rule over the course of the coming months.
"We believe it is critical that the Senate take action on the nomination because NCUA is beginning the process of finalizing a rule that will have substantial impact on credit unions and their ability to serve their members," CUNA Interim President/CEO Bill Hampel wrote.
The RBC plan proposed by the NCUA would make changes to Prompt Corrective Action rules, replacing existing risk-based net worth requirements with new risk-weighted asset and capital requirements. The rule would apply to federally insured "natural person" credit unions with more than $50 million in assets.
The proposal has drawn the concern of 324 members of the House of Representatives and current and former members of the Senate as well as 12 Federal Home Loan Bank presidents and a U.S. Chamber of Commerce group. (See News Now June 11: U.S. Chamber group warns RBC plan is 'mismatch' of tools, biz model.)
"Because the complexity of the proposal and the significance of its potential impact on credit unions and their ability to serve their members is so great," Hampel wrote, "it is in the best interests of the communities credit unions serve to ensure that the NCUA board members who will vote on the final rule be involved in the rulemaking process to the greatest extent possible."
"To be clear, we do not know how Mr. McWatters may view the proposed rule or what suggestions for changes he may bring to the process; we have had no contact with him on any substantive issue or concerning his confirmation," the letter states. "Our concern is that if the Senate does not act on his nomination soon, he may not have sufficient time on the board to be properly informed and engaged prior to a vote on the final rule."
Lastly, CUNA noted, "We are not aware of any opposition to Mr. McWatters' confirmation, and we urge the Senate to take action on the nomination as soon as possible."
McWatters is set to replace NCUA board member Fryzel, who began his term in July 2008. Although Fryzel's term expired Aug. 2 of last year, the Republican on the board agreed to remain in service until his successor was confirmed. CUNA's letter noted that his service on the board, and, "in particular, his participation in this rulemaking has been commendable."
McWatters was nominated in December.