October 15, 2015, the NCUA Board voted 2-1 to approve a final risk-based capital rule
which will take effect January 1, 2019. NAFCU has consistently opposed this
rulemaking and urged its withdrawal. We have long warned about the impact this
rulemaking will have on the credit union industry – in particular the
regulatory burden and costs it will impose. Given NCUA’s insistence on moving
forward with this rule, NAFCU worked steadfastly during 2014 and 2015 to make a
bad rule better. As a result of our efforts, the final rule recalibrates
many risk weights to better align with banks’ requirements, removes
interest-rate risk from the calculation of the risk-based capital ratio, and
extends the implementation date.
To create a true and fair risk-based capital system
for credit unions, NAFCU fundamentally believes that legislative reforms are
necessary. NAFCU has outlined a legislative solution that will institute
fundamental changes to the credit union regulatory capital requirements in our
Five-Point Plan for Regulatory Relief. The plan, as it relates to capital reform:
NAFCU continues to provide its members with in-depth analysis and tools to help assess how the new proposal will impact their credit unions, including:
The final rule makes the following key changes to the
agency’s current capital requirements:
NAFCU issued a Final Regulation comprehensively analyzing RBC's requirements as well as summarizing the key compliance expectations for credit unions. Additionally, NAFCU's previous Director of Regulatory Affairs, Alicia Nealon, authored a series of blog posts highlighting and synthesizing the final RBC rule.
Since the NCUA Board initially proposed RBC in January 2014,
NAFCU and our member credit unions have continually advocated for significant
changes. The final rule includes the following key changes:
To learn more about the issues NAFCU fought for and against in the RBC rule, please read the official comments submitted to NCUA on the agency's first and second proposal.
On November 23, 2015, NCUA sent a report
on its recently adopted risk-based capital rule to the House Financial
Services Committee, which voted overwhelmingly in September to support
H.R. 2769, a NAFCU-sought bill that would have required NCUA to “stop
and study” the rule before voting to implement it.In the
228-page report, NCUA defends the agency’s legal authority to create a
two-tier risk-based capital system, also questioned in H.R. 2769. In
addition, the report recommends that Congress allow well-managed credit
unions to count supplemental capital as net worth and suggests other
technical legislative changes affecting credit union capital
Ultimately, NAFCU believes legislative changes are necessary to bring about comprehensive capital reform for credit unions such as allowing credit unions to have access to supplemental capital sources, and making the statutory changes necessary to design a true risk-based capital system for credit unions.
NAFCU has stayed at the forefront of this issue and continued to champion credit unions in major media nationwide.
NAFCU Statement on NCUA’s Risk-Based Capital Report to House Financial Services Committee
(November 23, 2015)
NCUA Downplays RBC2 Effect on Credit Unions (Credit Union Times, October 24, 2015)
With RBC2 Final, NAFCU Focuses on Legislative Solution (Credit Union Times, October 19, 2015)
NCUA's Risk-Based Capital Rule Could Set Stage for Supplemental Capital Push (American Banker, October 16, 2015)
Washington Wrap: 'Wall Street regulates Congress' (SNL Financial, October 16, 2015)
NCUA Board, In 2-1 Vote, Approves RBC (CUtoday.info, October 16, 2015)
RBC Vote Could Prompt Tough Reaction by Congress (Credit Union Journal, October 15, 2015)
NAFCU Vows to Work to Make 'Bad Rule Better' (CUtoday.info, October 15, 2015)
NCUA: RBC2 Only Affects 16 Credit Unions (Credit Union Times, October 15, 2015)
NAFCU: NCUA's Final Risk-Based Capital Proposal Misses Mark, Credit Unions Still Need Legislative Solution For True Risk-Based Capital System
(October 15, 2015)
Trade Groups Eager To See How 'Revised' The Revised RBC Rule Will Be (CUtoday.info, October 12, 2015)
RBC Up For Vote Next Week (CUtoday.info, October 9, 2015)
NAFCU: Disappointed With NCUA's Advancement of Second Risk-Based Capital Proposal
(October 8, 2015)
Stop & Study Bill Clears Committee (Credit Union Times, September 30, 2015)
House Committee Favorably Votes Out Several CU-Supported Bills, Including 'Stop and Study' (CUtoday.info, September 30, 2015)
NAFCU Statement In Response to the House Financial Services Committee Mark-up of 'Risk-Based Capital Study Act of 2015'
(September 30, 2015)
NAFCU Continues To Press HFSC To Support 'Stop & Study' (CUtoday.info, September 29, 2015)
'Stop & Study' Bill Scheduled For Wednesday Mark-Up (CUtoday.info, September 27, 2015)
NAFCU Statement In Response to House Financial Services Committee Mark-up of 'Stop and Study' Bill
(September 25, 2015)
Stop and Study Heads to Mark Up (Credit Union Times, September 24, 2015)
House Lawmakers Blast Credit Union Capital Plan (American Banker, September 17, 2015)
See all of NAFCU's media outreach.
REGULATORY ALERT: 15-EA-02: NCUA - RBC2 (member-only) – Download NAFCU's summary of the new proposed risk-based capital rule.
View entire series of Risk-Based Capital posts
Letters to NCUA
Updated April 2016