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November 25, 2014

NCUA: Stabilization assessment range still negative

NCUA updated its information on the costs of the Corporate Resolution Program and the Guaranteed Notes Program, saying the upper and lower ends of the Temporary Corporate Credit Union Stabilization Fund assessment range remain negative.

This means it is unlikely credit unions will be charged assessments in the future, though NCUA said "the projections are subject to change based on the performance of the failed corporates' legacy assets, future legal recoveries and economic variables."

At the NCUA Board meeting last week, agency staff told the board no assessment is likely to be needed next year for the TCCUSF and that any share insurance premium would likely be in the range of 0 to 5 basis points. Since the stabilization process began, insured credit unions have paid $4.8 billion in stabilization assessments. The last share insurance premium was assessed in 2010. NAFCU has strongly urged against future assessments and continues to push for more transparency from NCUA on the stabilization costs being paid by credit unions.

NCUA noted that principal and interest on NCUA Guaranteed Notes must be fully repaid before the agency can give credit unions any rebate.