LONDON, England (11/12/09)--The Financial Services Authority (FSA), the regulator of all providers of financial services in the United Kingdom, intends to tighten rules for England’s credit unions by increasing their minimum capital requirements. Increasing capital and liquidity requirements will offer better protection for members and help credit unions avoid failures and defaults, analysts said (Reuters via The New York Times Nov. 11). Under the changes proposed Wednesday, smaller credit unions need to meet a minimum capital-to-assets ratio of 3%. Currently they only need to be solvent. The National Credit Union Administration’s standard is 7% in the U.S. The changes also would raise start-up capital requirements to about $16,500 for small credit unions and about $83,000 for large credit unions. The changes also would raise the minimum liquidity requirement to 10% of total liabilities for credit unions. The rules changes also aim to bolster governance standards. The FSA cites poor governance as a key reason for the failure of credit unions. The changes would go in effect during the second quarter 2010 and be phased in over two to three years.