The NCUA board proposed a two-year delay of the implementation date for its risk-based capital rule to Jan. 1, 2022 at its Thursday meeting. The rule is currently scheduled to become effective Jan. 1, 2020.

 “We thank Chairman Hood and the NCUA board for delaying the implementation date of the rule, which will give the agency time to examine ways to ensure the risk-based capital standard is appropriate to the risk profile of the credit union system and consistent with federal law,” said Ryan Donovan, CUNA chief advocacy officer. “We continue to believe that the rule is a solution in search of a problem, but we appreciate NCUA’s efforts thus far to make positive changes to the rule, and we look forward to engaging with the agency going forward on potential additional changes.”

Agency staff said that the delay will give NCUA time to “holistically” consider changes to the agency’s capital standards, specifically regarding:

• Subordinated debt;
• Capital requirements for asset securitization; and
• Community bank leverage ratio equivalent.

NCUA Chair Rodney Hood said during the meeting that the board would take up a subordinated debt proposal by the end of this year.

NCUA staff said the current Prompt Corrective Action regulation would remain in effect until Jan. 1, 2022. Comments on the proposed delay will be due within 30 days after its publication of the Federal Register.

NCUA previously delayed the rule from becoming effective Jan. 1, 2019 with a one-year delay and raising the threshold for risk-based capital.