The King-Meeks letter encouraged the NCUA Board to take into account the cost and burden of implementing the new risk-based capital requirements beyond the current leverage ratio; to provide a justification for the proposed risk-weights and why the proposed risk-weights differ from those for community banks; and to give credit unions more than 18 months to comply with the risk-based capital requirements, when finalized.
In her letter, Chairman Matz pointed out the need for the proposed rule and sets forth why the risk-weights for some asset classes diverge from those for community banks.
She noted that "[b]y law, NCUA must adopt a risk-based capital rule that is comparable to the rules for banks but that also takes into account any material risks to credit unions, such as interest rate risk and concentration risk in addition to credit risk."
She does appear to be sympathetic to giving credit unions an adequate amount of time to comply with the regulation, when it is finalized.
However, the letter makes it pretty clear that she has taken an exception to the dissemination of misinformation about the costs of the proposed rule from some trade associations.
Below is Chairman Matz's letter.
The battle of the spin doctors.
ReplyDeleteCuna (cu not accountable).
Nafcu proud author of the preposterous GDP impact of taxing credit unions that only they believe.
NCUA, proud rescuer of the cu movement from legacy assets and soon IRR.
Bill - let's write another white paper that only he understands or believes- Hample.
Peter ( dare we say any congressman) King.
No wonder we have tuned out.
Now wonder many credit unions have disaffiliated or are thinking of.
Could Queen Debbie be any more arrogant or rude to a sitting congressman? Obviously, she's applying for her next government job.
ReplyDelete