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News Now

Washington
Hyland wants accelerated supplemental capital push
ALEXANDRIA, Va. (12/9/08)—National Credit Union Administration (NCUA) board member Gigi Hyland announced Monday she wants to accelerate consideration of supplemental capital approaches to helping credit unions through a tough economy. She said in her role as NCUA liaison to the National Association of State Credit Union Supervisors (NASCUS), she has heard state regulators' compelling arguments “that it is time to seriously consider whether credit unions must be given access to some form of supplemental sources of capital to continue providing members the services they need.” “The economy is taking its toll on every facet of the financial services industry, including credit unions,” Hyland stated in a release. Unlike other financial institutions, credit union access to capital is limited to reserves and retained earnings from net income. Permitting credit unions to accept supplemental capital would require action by the U.S. Congress. “(S)o the sooner we get started on this effort, the better,” Hyland said, and added, “I am committed to working with the state supervisors to expeditiously resolve if and how supplemental capital can be correctly structured and serve as an appropriate safety and soundness tool for the NCUA and state supervisory authorities in regulating U.S. credit unions.” In November NASCUS sent a letter to federal lawmakers, which emphasized that while credit unions remain safe and sound in this troubled and volatile market, supplemental capital will enhance their ability to react to market conditions, grow into the future and serve their members in times of economic trouble. The Credit Union National Association (CUNA) supports a system giving credit unions access to supplemental capital. In fact it was among the credit union topics CUNA President/CEO Dan Mica discussed last week during a meeting with President-elect Barack Obama's Transition Team.


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