Advocacy on the Move
NCUA June Board Meeting Preview with Unified Agenda
June 17, 2021
The NCUA released their June 24, 2021 board meeting agenda. The NCUA board is expected to vote unanimously to approve a rule that will allow credit unions greater flexibility to capitalize interest associated with loan workouts. In addition, the Board will issue a final CECL rule and as required will set the interest rate ceiling which is expected to be unchanged.
The CECL rule has seen a number of iterations and has been improved over time. Many credit unions and third parties have developed CECL compliant tools for assessing credit loss and for evaluating their allowance accounts in accordance with FASB . However, given the fact that the Covid pandemic has resulted in more adverse economic assumptions some credit unions could still end up with additional pressure on capital.
MATTERS TO BE CONSIDERED:
- Federal Credit Union Loan Interest Rate Ceiling.
- Final Rule, Part 702, Current Expected Credit Loss Methodology.
- Final Rule, Part 741, Appendix B, Capitalization of Interest.
In addition the Spring Unified Agenda detailing rulemaking by the NCUA and CFPB was released earlier this week. Of note was that the CFPB had a very short Spring Regulatory Agenda relative to their historical agenda with very little changes to what was on the agenda during the previous Administration.
- Link to NCUA Spring Regulatory Agenda
- Link to CFPB Spring Regulatory Agenda
- Link to Long term CFPB Actions
The Regulatory Advisory Committee will evaluate the Spring Regulatory agendas as well as rules that are out for comment. The Committee will determine which rules should be prioritized for comment and will offer suggestions on how currently proposed rules could be improved.