NAFCU to NCUA: Return NOL to 1.3%
NAFCU Chief Economist and Vice President of Research Curt Long Tuesday urged the NCUA to reset the National Credit Union Share Insurance Fund's (NCUSIF) normal operating level (NOL) to the historical level of 1.3 percent so that credit unions may realize the fullest distribution.
The NCUA Board received an update on the NCUSIF quarterly report during its November meeting. According to the agency, the fund posted a net income of $24 million in the third quarter of 2019, with gains attributed to strong investment income earnings.
"While a distribution from the SIF in 2019 will depend on the performance of the fund over the second half of the year, as well as the NCUA Board's discretionary selection of the NOL, conditions for the fund have improved," wrote Long in a letter to the agency. "Insurance losses during the year have been minimal, and agency staff recently announced that it would begin to reverse the shortening of the investment portfolio duration which began in 2017, thus providing the opportunity for greater yield in the future."
In the letter, Long discussed the future of the NOL and the agency's current five-year forecast. He also reiterated NAFCU's support of a strong NCUSIF and a NOL "which provides adequate protection to taxpayers and minimizes the potential for premium charges to credit unions."
"NAFCU also believes that the SIF should be managed proactively with a goal of identifying and quantifying salient risks," he added. "However, those goals must be balanced with the understanding that credit union resources are scarce."
In May, more than 5,5000 credit unions received $160.1 million in equity distributions from the NCUSIF. This followed the agency's reporting of an equity ratio of 1.39 percent at the end of 2018, which was above the board-approved NOL of 1.38 percent.
Add to Calendar 2020-07-30 14:00:00 2020-07-30 14:00:00 NAFCU Roadshow: Issues Facing Alabama, Mississippi & Louisiana Credit Unions During COVID-19 Please join us on Thursday, July 30 at 2:00 p.m. ET (1:00 p.m. CST) as we host a special webinar for Alabama, Mississippi, and Louisiana-based credit unions. During the webinar, NAFCU EVP and COO Anthony Demangone will discuss what credit unions should expect in the coming months amid the COVID-19 pandemic and what NAFCU is doing to help credit unions during this difficult time. COVID-19 isn’t stopping NAFCU from what we do best; engaging with credit unions. PROGRAM UNDERWRITTEN BY Key Takeaways Review the Small Business Administration’s Paycheck Protection Program; Discuss regulatory relief; Learn more about what’s happening on your behalf in meetings with the NCUA and CFPB; Walk through market specific performance trends; And more! Note: The information in this webinar is tailored to Alabama, Mississippi, and Louisiana-based credit unions. Register Now For On-Demand AccessRegistration is complimentary, but you must register to attend.One registration gives your entire credit union access to the on-demand recording until July 30, 2021.Already registered? Go to the Online Training Center to view live. Who Should Attend? Alabama, Mississippi, and Louisiana-based credit unions Education Credits This webinar doesn't qualify for any continuing education credits recognized by NAFCU or NASBA. About Our Webinars Our webinars are streamed live from NAFCU headquarters near Washington, D.C. Your audio/video feed of the presenters includes presentation slides and downloadable handouts. You can easily submit your questions to the presenters at any time during the live broadcast, with no dialing over the phone! The audio and video stream directly through your computer. Web NAFCU firstname.lastname@example.org America/New_York public
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