June 22, 2014

NAFCU underscores CUs' soundness in WSJ

June 23, 2014 – The Wall Street Journal on Friday published NAFCU's letter to the editor pointing to credit unions' sound risk management and taking issue with NCUA's earlier comments that credit unions are giving short shrift to interest-rate risk.

In the June 6 WSJ, NCUA Chairman Debbie Matz is quoted noting concerns that credit unions were "choosing not to do anything about" rising interest rates and risk. NAFCU President and CEO Dan Berger sent a swift rebuttal.

"Credit unions have strong underwriting standards and will continue to make safe and sound investments," Berger wrote in the letter to the editor. "Rather than trying to inappropriately account for rate risk through its proposed risk-based capital rule, NCUA should focus on giving credit unions additional tools and resources, such as increased investment authority, to manage their interest-rate risk."

On Friday, House Financial Services Committee Chairman Jeb Hensarling, R-Texas, and Financial Institutions and Consumer Credit Subcommittee Chairman Shelley Moore Capito, R-W.Va., wrote NCUA of their concerns the risk-based capital proposal, which attempts also to address interest-rate risk, will harm credit unions' ability to compete amid other providers.