WASHINGTON, DC (January 23, 2013) -- The Credit Union National Association President & CEO Bill Cheney released the following statement after news that the National Credit Union Administration released a new risk-based capitol framework:
“Given how well credit unions in general survived the recent great recession, we do not think there is a credible case for increasing credit union capital requirements.
While it is apparent the agency has put much effort into developing the proposal, which would have a lengthy transition period, we are reviewing it in detail with our Examination and Supervision Subcommittee – which has already expressed the view that the current system seems to provide sufficient levels of capital.
CUNA supports capital modernization -- including risk-based net worth -- but as part of a broader plan that considers appropriate leverage ratios and also access to supplemental capital. We are assessing the impact not only on the 199 credit unions that would be affected if the proposal is adopted, but also on the credit union system as a whole.
The bottom line for us is: If our members agree that this proposal is needed, our primary objective in developing our position will be to ensure a final rule is narrowly tailored to minimize any negative effects on credit unions. We are particularly troubled by the section of the proposal that would allow NCUA to raise the risk-based capital requirement of an individual credit union above the normal threshold levels based on subjective factors. We will be closely looking into this.”