NWCUA: We Will Continue to Advocate for a Better Rule
May 29, 2014
May 29, 2014
The NCUA gave credit unions a hard-and-fast 90-day period to register comments on the proposed Risk-Based Capital rule. By Wednesday’s deadline, the regulator had received an earful — objections from more than 1,100 credit union leaders — including responses from up to a third of Northwest credit unions and from more than 320 members of Congress.
The credit union movement isn’t finished yet.
“Even though the official comment period ended May 28, we will continue to advocate for a change to this flawed proposal,” said John Trull, the Northwest Credit Union Association’s director of regulatory advocacy.
Trull outlined a number of face-to-face opportunities for the Association and credit union advocates to weigh in this summer. Most immediately, the NCUA is conducting a “Listening Session” in Los Angeles on June 26. Two other sessions are planned for July in Chicago and Alexandria, Virginia.
“We will be there and encourage Northwest credit union advocates to attend as well, to share their stories with the NCUA.”
The proposed rule would replace existing risk-based net worth requirements with new risk-weighted asset and capital requirements, causing credit unions with net worth ratios above 10.5% to reevaluate their balance sheets. The proposal could require credit unions to hold as much as $7 billion in additional capital, according to estimates prepared by economists for the Credit Union National Association.
CUNA filed its 40-plus-page letter in the final hours of the comment period Wednesday. “Credit unions have been subjected to a number of new rules in the wake of the financial crisis, but none of them is as potentially harmful as this proposal,” the letter stated. “Indeed, the economic and legal issues spawned by the proposal are numerous, the policy questions are real, and, as evidenced by the overwhelming level of interest in this rule, the stakes for credit unions and their 99 million member owners could not be higher.”
The Northwest Credit Union Association submitted an eight-minute video to the NCUA, featuring thoughts from credit union leaders about the proposed rule’s impact. An excerpt of the video is available for public viewing and tells the story through the eyes of Old West Federal Credit Union CEO Ken Olson. Northwest credit unions also filed official comment letters with the regulator. Read some of the comment letters on the NWCUA’s online resource guide, in the “write a letter” section.
The massive volume of objections — and alternative proposals — offered by the credit union industry promise to immerse the regulator in a lengthy period of analysis this summer, and Northwest credit unions won’t miss any opportunity to advocate.
In addition to attending the NCUA Listening Sessions, Trull said the Association will actively participate in a roundtable discussion with NCUA Board Member Rick Metsger while also sharing concerns with the members of the work group the regulator created to study the rule. Trull pointed out that two Northwest credit union professionals are part of the group.
“We will not let up,” he said.
Questions about this story? Contact Lynn Heider: 503.350.2225, email@example.com.