ALEXANDRIA, Va. (4/4/14)--The National Credit Union Administration's risk-based net worth calculator, which is intended to help credit unions calculate how an agency proposal would impact their business practices, will be taken off the NCUA homepage once the comment period on the proposal is up on May 28.
The Credit Union National Association has urged the agency to limit access to the calculator, as the online tool currently allows the public to determine a credit union's capital adequacy under the proposal. CUNA is pleased the agency will take the calculator down but feels it should not have been available to the general public.
The announcement was made within an NCUA release Thursday that reminded credit unions that they have until May 28 to comment on the agency's pending risk-based capital proposal.
The NCUA release also referred to an extended phase-in period for the final risk-based capital (RBC) rule in order to allow credit unions enough time to adjust risk profiles or capital levels, or both, and to ensure compliance with the new regulation.
The supplementary information to the RBC proposed rule indicates an 18-month implementation period. CUNA asserts that this is nowhere near long enough and points out that commercial banks have until 2019 to comply with Basel III risk-based requirements.
In the release the agency also noted that after it approves a final rule, it will modify the Call Report to comply with the terms of a new rule and provide Prompt Corrective Action classifications accordingly.
The NCUA board approved the RBC proposal at its January open board meeting. The plan would apply to credit unions with assets greater than $50 million and assigns certain risk weights for different assets.
In mid-March, NCUA Chairman Debbie Matz wrote to CUNA President/CEO Bill Cheney--in response to CUNA's urgings that the agency scrap the plan or make significant changes--and at the very least allow for an extended phase-in period. She said key changes to the proposal are "not out of the question."
Matz added, "Just as NCUA incorporated significant changes to our final rules on troubled debt restructurings, loan participations and derivatives ... I assure you NCUA will do so, as appropriate, on this critically important rule" (News Now March 11).
CUNA continues to urge credit unions to weigh in on the proposal to let regulators know their concerns. CUNA's RBC Action Center is a complete catalog of reference materials for credit unions and it also provides credit unions with a tool to send comment letters to the NCUA.
For the NCUA release and CUNA's RBC action center, use the resource links.