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NAFCU Reg Committee, NCUA's Hauptman discuss CU priorities, concerns
NCUA Vice Chairman Kyle Hauptman joined NAFCU's Regulatory Committee Tuesday to discuss several top credit union issues and his priorities moving forward as the industry emerges from the coronavirus pandemic and economic crisis.
During the meeting, Hauptman participated with a Q&A with committee members and answered questions on a variety of topics, including:
- the impacts the coronavirus pandemic has had on credit union net worth ratios and share growth;
- the potential for an extended exam cycle for well-managed credit unions;
- the NCUA’s proposed a rule to create a three-year phase-in of the day-one adverse impacts of the current expected credit loss (CECL) standard on federally-insured credit unions' (FICUs) net worth ratios (currently, the standard isn't effective for credit unions until 2023); and
- the importance of innovation and technology, specifically how credit unions can partner with emerging fintechs.
In addition, the group reviewed areas where modernization of credit union rules, including risk-based capital (RBC) and risk-based net worth (RBNW), can be achieved through capital reform.
NAFCU has previously offered full support for the NCUA’s proposed rule to amend its RBNW requirement as the relief provided "will enable credit unions to better prioritize service to members and support lending activities." The agency's proposal would increase the threshold for defining a complex credit union for purposes of the current RBNW requirement to $500 million and a RBNW requirement that exceeds six percent until the Jan. 1, 2022, effective date of the final RBC rule.
NAFCU will continue to work with the agency and remain in close contact to share credit unions' experiences and concerns as they work to serve members amid the coronavirus pandemic.
Stay tuned to NAFCU Today for the latest developments on these topics and more. The Regulatory Committee will next meet May 11.