NCUA Budget Kabuki

by Henry Meier

It’s November, which means Thanksgiving; the New York Giants playing lousy football in preparation for a Super Bowl run; and NCUA releasing its budget to howls of outrage by the industry.  This year is, of course, no exception.

In case you missed it, at its board meeting yesterday NCUA announced a 2013 budget of $251.4 million to fund its activities, representing a 6.1% increase over last year’s budget.   NCUA also projected a NCUSIF premium range between zero to 5 basis points in 2013 and a Stabilization Fund assessment range of 8 to 11 basis points.

I would love to say that I am outraged by a 6% budget increase in a time of continued fiscal austerity but in truth I have no idea whether this is a good or bad budget and no easy way of figuring it out.  More importantly, neither do the credit unions that pay NCUA’s bill.

For example, NCUA points out that it is not increasing staff levels in 2013.  This could mean that NCUA is doing all it can to hold down costs but doing so consistent with its overriding responsibility of maintaining safety and soundness.  Then again, it could mean that NCUA could actually be cutting back staff if it was not increasing its oversight of state-chartered institutions, which already have primary regulators.

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