CUNA wrote in support of a bill Wednesday that would repeal NCUA’s risk-based capital rule, currently scheduled to go into effect in January 2019. The Common Sense Credit Union Capital Relief Act of 2017 was introduced by Rep. Bill Posey (R-Fla.).
Credit unions throughout the United States have expressed their significant concerns regarding the National Credit Union Administration’s (NCUA) risk-based capital standards for credit unions.
“Specifically, many of these concerns pertain to whether NCUA has legal authority to impose the requirements,” wrote CUNA President/CEO Jim Nussle. “In addition, credit unions have a particular concern with risk-based capital standards for the purpose of determining whether a credit union is well-capitalized as the Federal Credit Union Act permits the NCUA to impose a risk-based standard for the purpose of determining capital adequacy only.”
Nussle also noted credit unions have significant concerns with the additional regulatory burden imposed by the risk-based standards, particularly sunce CUNA analysis shows the changes would have done very little to reduce share insurance fund costs during the financial crisis.
NCUA Chairman J. Mark McWatters said during CUNA Governmental Affairs Conference earlier this year that he hopes to revisit the risk-based capital rule.