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April 11, 2014 – NCUA's risk-based capital proposal is more restrictive than the banks' system and will impede a credit union's ability to build capital, according to speakers in NAFCU's webcast yesterday.

Denise McGlone, executive vice president and CFO at Affinity FCU, was joined by NAFCU Director of Regulatory Affairs Michael Coleman and Senior Economist Curt Long in leading yesterday's webcast.

McGlone said NCUA's proposal will restrict growth and force credit unions into short-duration investments and consumer loans, which will impact mortgage loans, member business loans and the economy as a whole. She said credit unions should submit comment letters to NCUA and recommend removing the examiner discretion provision, fixing the credit union service organization risk weights.

Coleman focused on areas of concern within the NCUA proposal and the available NAFCU resources, including a recently released guide of talking points, to help credit unions formulate their comment letters to NCUA. Comments are due May 28.

"NAFCU encourages all credit unions to submit comment letters to NCUA, particularly emphasizing the impact of the proposal on their credit union's portfolio and future operational decision making," Coleman said.

Long discussed risk weights, industry impact and scenario analysis using NAFCU's risk-based net worth calculator, which was made accessible to all webcast attendees. He said if a credit union wants to maintain its current capital cushion, it will likely need to add more capital under NCUA's proposal.