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NAFCU meets with lawmakers on CECL
Members of NAFCU's legislative affairs team met Friday with lawmakers on Capitol Hill to discuss the association's concerns related to the Financial Accounting Standards Board's (FASB) current expected credit loss (CECL) standard. Legislation to halt the standard until its impact can be studied has been introduced in both the House and Senate.
In the discussions with the Hill, NAFCU stressed concerns about credit unions' unique capital framework, which limits the NCUA's ability to mitigate CECL's effect on institutions' net worth without action from FASB. Because of this, NAFCU urged FASB to exempt credit unions from this standard. More flexibility with CECL compliance is also among the association's priorities for the NCUA Board to address.
"As it stands, CECL is an unnecessarily complex accounting method that only adds to the mounting regulatory stress placed upon credit unions," said NAFCU President and CEO Dan Berger following the Senate bill's introduction. "Taking the time to fully study the consequences of this new regulation on consumers' access to credit and the economy as a whole is a necessary step that must be taken. More so, we continue to maintain that credit unions should be exempt from CECL."
The association also provided an update on CECL to members during a Q2 member call last week. NAFCU will continue to work with all stakeholders to obtain relief for credit unions under CECL.