In 2015, NAFCU issued a Final Regulation comprehensively analyzing RBC's requirements as well as summarizing the key compliance expectations for credit unions. Additionally, NAFCU published a series of blog posts highlighting and synthesizing the final RBC rule.
In January 2014, NAFCU and our member credit unions have continually advocated for significant changes after the NCUA Board initially proposed the RBC rule. The final rule includes the following key changes:
- Removes Individual Minimum Capital Requirement;
- Removes interest rate risk (IRR) from consideration in the RBC calculation;
- Raises the threshold for determining “complex credit union,” for the purposes of capital requirements, from $50 million to $100 million in assets;
- Drops the 1.25 percent Allowance for Loan and Lease Losses (ALLL) cap from the risk-based capital ratio numerator;
- Revises a number of risk-weights, including those for Member Business Loans, CUSOs, corporate credit unions, real estate loans and investments; and
- Provides for an extended implementation period until January 1, 2019.
- Incorporates a “Non-Significant Equity Exposure” risk-weight of 100 percent for non-consolidated investments in CUSOs, perpetual paid in corporate capital, among other, when the total of equity exposures is less than 10 percent of the credit union’s capital elements of the risk-based capital numerator;
- Adds a section for “Charitable Donation Accounts,” assigning it a risk weight of 100 percent;
- Clarifies that “excluded goodwill” and “excluded other intangible assets” applies to mergers or combinations completed on or before 60 days after publication of the final rule in the Federal Register, and extending the expiration of this definition to January 1, 2029.