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News Now

Washington
Fryzel urges CU action on bill
ALEXANDRIA, Va. (4/16/09)—National Credit Union Administration (NCUA) Chairman Michael Fryzel Wednesday urged credit unions to support the agency’s legislative plan to replenish the National Credit Union Share Insurance Fund (NCUSIF) over time. In his first speech since the agency placed U.S. Central FCU (U.S. Central) and Western Corporate FCU (WesCorp) into conservatorship in March, Fryzel said he wants credit unions to “roll up their sleeves” and use grassroots activism to promote passage of the NCUA bill. The legislation would allow credit unions to spread the cost of the NCUSIF replenishment over as many as seven years. At issue is the cost to natural person credit unions of recent actions by the NCUA to stabilize the corporate credit union system. Fryzel was addressing the Texas CU League’s annual meeting in Austin. Meanwhile, in Washington, D.C., an NCUA spokesman said the agency is “optimistic” the bill could be passed this spring as part of a broader measure addressing an extension of the higher share and deposit insurance limits approved as part of a stimulus package. In his speech, Fryzel said legislative relief is just part of the agency’s current job right now. “When this stabilization proposal becomes law, our job will not be finished. I have made a commitment to the administration, to Congress, and to you in the industry that NCUA would undertake a broad and comprehensive reform of the corporate system. We have initiated a rulemaking process that I promise will yield results,” he said. Agency staff addressing press questions in Washington reflected their chairman’s remarks. David Marquis, when asked, said the agency’s immediate plans for the corporate credit union system is to maintain liquidity so loans don’t have to be sold and “so we can maintain a level of losses” that are less of a burden on the credit union community. Marquis is NCUA executive director. He said beyond that, NCUA continues work to develop “rule and regulation” for the corporate system that takes on issues “we will have to address going forward.” The agency recently received approximately 450 comment letters responding to its ANPR on corporate credit unions issues. Marquis said the agency is now working to determine what the credit union system in the future will want from the corporate credit unions. He added that beyond that, the NCUA is addressing what needs to be done to address “supervision and safety and soundness changes going forward.”


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