WASHINGTON (7/11/14)--New voices from both the House Ways and Means Committee and the Senate Banking Committee have joined the chorus of concerns regarding the National Credit Union Administration's proposed risk-based capital (RBC) plan. Republicans Rep. Kenny Marchant (Texas) and Sen. Dean Heller (Nev.) sent letters to the agency July 10 .
Ways and Means' Marchant asked the NCUA to:
- Identify the statutory authority upon which the agency is relying to impose a higher risk-based capital requirement on well-capitalized credit unions;
- Explain why the NCUA is attempting to regulate concentration and interest-rate risk thorough the addition on new capital requirements as opposed to relying on NCUA examiners to monitor risks of individual credit unions;
- Identify the statute that gives the NCUA any authority to impose individual capital requirements on credit unions; and
- Explain why 18 months, as proposed, is an adequate implementation time.
Senate Banking's Heller warns in his letter that the risk weights in the proposed rule may be "unduly burdensome" and could "reduce the availability or affordability of loan products and restrict credit" available through credit unions.
Heller added that credit unions in his state have warned him that the RBC plan, as written, will force a change in how they operate and require more time spent on regulatory compliance at a cost to helping the state's "struggling economy."
Other members of the Senate Banking Committee who have weighed in with concerns include its chairman, Sen. Tim Johnson (D-S.D.); its ranking member, Sen. Mike Crapo (R-Idaho); and Sen. Heidi Heitkamp (D-N.D.). From House Ways and Means, Rep. Erick Paulsen (R-Minn.) also has warned that credit unions in his state would be adversely affected by the NCUA's RBC proposal.
(See related story: NCUA gets more specific on RBC plan review at Chicago Listening Session.)