NCUA board approves risk-based rule

The NCUA board approved its risk-based capital rule, which included only a few changes to the risk weights proposed in January.

First, the final rule reduced the risk weight for equity investments in CUSOs, corporate perpetual contributed capital and other higher risk equity investments to 100% if the total of equity exposure is less than 10% of the sum of the credit union’s capital elements of the risk-based capital ratio numerator. The NCUA said it estimated 95% of credit unions with such investments will be assigned the lower risk weight.

The charitable donation accounts risk weight was reduced to 100%.

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