Removing Barriers Blog

CUNA Asks NCUA to Consider Floating Interest Rate Cap
Posted May 22, 2019 by Chandler Schuette

Today, CUNA sent a letter to NCUA asking it to consider the pros and cons of replacing the existing fixed interest rate cap on FCU loans with a floating rate cap.

“The NCUA should conduct outreach to the industry—preferably through an advance notice of proposed rulemaking (ANPR)—to gather information on the potential benefits and concerns associated with replacing the existing fixed interest rate cap with a floating cap.”

While it is critical that the Board at least maintain the current cap of 18%, we ask the Board to examine the potential benefits associated with a floating interest rate cap, such as the enhanced ability of FCUs to manage interest rate risk.