NCUA meets to discuss corporate capital issues

ALEXANDRIA, Va. (11/6/09)—At a National Credit Union Administration (NCUA) meeting Thursday on corporate credit union issues, Credit Union National Association (CUNA) President/CEO Dan Mica urged the agency to allow a process that would leave the door open to future capital recoveries if the magnitude of losses at the corporate credit unions is not as great as the NCUA has estimated.

The meeting was called by NCUA Chairman Debbie Matz to conduct a wide-ranging discussion of issues related to the treatment of corporate capital and the upcoming NCUA corporate rulemaking. About 40 representatives of corporate credit unions, natural person credit unions, CUNA and the leagues, and others, attended the meeting.

The session facilitated an open and frank discussion of the NCUA's decision to deplete capital in Western Corporate CU and U.S. Central CU and the consequences of that decision, according to CUNA Deputy General Counsel Mary Dunn, who attended the meeting. Also discussed were possible approaches to mitigate the impact of that decision.

After the meeting at NCUA headquarters here, Matz said in a statement that the agency will immediately begin analysis of the information gathered, "take a fresh look at the capital depletion issue and its component parts, and make certain that NCUA is proceeding in a way that satisfies all legal, policy and accounting requirements."

She said the corporate review will be completed in a way that will "enable all stakeholders to move forward with full transparency of corporates' financial statements and full confidence in the stability of the credit union industry."

The NCUA is expected to come out this month with its anticipated draft plan for restructuring corporate credit union regulations.

Among those attending the Thursday meeting were California League President Bill Cheney, Utah League President Scott Simpson, CUNA Accounting Task Force Chair Scott Waite, CUNA General Counsel Eric Richard, and Senior Economist Mike Schenk.