ALEXANDRIA, Va. (8/12/14)--Sen. James Inhofe (R-Okla.) became the 27th senator to write to the National Credit Union Administration regarding the agency's risk-based capital proposal Monday, echoing concerns from credit unions across his state, as well as the members and businesses they serve.
Inhofe acknowledged in his letter than a strong capital base is essential to maintaining a healthy financial system, and he affirmed his dedication to protecting the National Credit Union Share Insurance Fund and taxpayers.
However, he also said he is concerned that the NCUA has not justified the need for the proposal. He cited warnings from credit unions in his state that have told him they would have to change the way they operate in order to raise capital. He said is it estimated that Oklahoma credit unions would need to raise approximately $105 million in capital just to ensure capital buffers remain intact.
"Nationally, over 4,000 credit unions offer mortgage products and enjoy loss rates well below the national average. The risk weights in the proposed rule could force credit unions to reduce the availability or affordability of loan products, restricting credit to their members," he wrote.
Inhofe also requested that the NCUA provide justification for the need for a new risk-based capital requirement at this time.
In addition to 27 senators, 332 representatives (76% of the House) have written to the NCUA with concerns about the proposal. The agency has addressed several of these concerns, such as the proposed 18-month implementation period, which will be lengthened.