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Today: NCUA Board to issue exams RFI, proposed rule on risk-based net worth
The NCUA Board meets today and is expected to issue a request for information on the future of exams and supervision, a final rule on technical amendments, and a proposed rule on risk-based net worth. The board is also set to receive a briefing on the agency's guaranteed notes oversight program and an annual report on minority depository institutions (MDIs).
Exams and Supervision
Earlier this week, the federal financial institution regulators, including the NCUA, and state regulators issued guidance directing examiners to consider how the pandemic has impacted institutions as they assess safety and soundness.
Additionally, the NCUA last week issued a Letter to Credit Unions detailing its multi-phase approach to resuming on-site operations and conducting voluntary on-site examinations.
NAFCU has consistently pushed the NCUA for updates on exam modernization. NAFCU President and CEO Dan Berger previously called on the agency to provide additional examination flexibility and make other regulatory adjustments to ensure credit unions can focus on helping members during the coronavirus pandemic.
He also discussed exam relief in conversations with Hood, Harper and Board Member J. Mark McWatters.
Risk-Based Net Worth
The NCUA has previously indicated it is still working on efforts to create a community bank leverage ratio (CBLR) analog for credit unions that will be subject to the RBC rule. Under the CARES Act, the community bank leverage ratio was reduced from 9 to 8 percent.
Last year, the NCUA Board passed a final rule to delay the implementation of its risk-based capital (RBC) rule by two years to Jan. 1, 2022.
NAFCU previously urged the agency to grant additional capital flexibility and provide parity with banks amid the coronavirus pandemic and has led efforts to ensure credit unions and their members benefit from a modern capital regime.
NAFCU will monitor today’s meeting and update credit unions via NAFCU Today. The board will next meet July 16; view the 2020 meeting dates.