Newsroom

March 23, 2020

NCUA's annual report highlights agency performance, NAFCU-supported wins for CUs, more

NCUAThe NCUA Friday released its 2019 Annual Report, which provides credit unions with details on the agency's progress on policy initiatives, financial standing and expected challenges in the year ahead.

Of note in the report was the NAFCU-supported delay of the agency's risk-based capital (RBC) rule to January 2022. The NCUA previously approved delaying the RBC rule until Jan. 1, 2020, but the association recommended the agency pursue a longer delay and significant revisions to the rule. A NAFCU-backed provision to delay the rule by two years from its original implementation date passed the House three times in 2018.

Currently, the agency is working on a community bank leverage ratio for its RBC rule. NAFCU has recommended that the NCUA provide credit unions with parity to changes made to bank capital under the Economic Growth, Regulatory Relief, and Consumer Protection Act (S. 2155).

The NCUA approved several final rules in 2019, including:

  • PALs: The board approved a final rule to expand its payday alternative loans (PALs) program. NAFCU and member credit unions met with the agency in May to encourage flexible parameters and provided comments on the proposal.
  • Bylaws: The board approved a final rule that codifies in one place several existing NCUA legal opinions and clarifies several bylaw provisions. The rule details guidance to help credit union officials, employees, and members better understand bylaw provisions, including a credit union’s ability to limit services to a disruptive or abusive member. Legislatively, a NAFCU-sought bill to give CUs flexibility in governance policies was released last month.
  • Public unit and nonmember shares: The board unanimously approved a final rule that would amend the agency's regulations to permit credit unions to receive public unit and nonmember shares up to 50 percent of its net paid-in and unimpaired capital and surplus less than any public unit and nonmember shares. NAFCU will continue to advocate for ways to provide relief to credit unions that rely on a large volume of nonmember shares.

Looking ahead, the agency is preparing to address growing cyber threats, technology-driven changes to the financial landscape, interest rate risk and liquidity risk and more in 2020. The NCUA will also continue its efforts on exam modernization.

NAFCU has consistently pushed the NCUA for updates on exam modernization and met directly with NCUA Chairman Rodney Hood and board member Todd Harper to discuss the agency’s efforts to improve exams.

The full report is available here; NAFCU in January shared its 2020 priorities with the agency.