Removing Barriers Blog

CUNA Meets with NCUA to Discuss RBC, MBL, and Examinations
Posted September 24, 2015 by CUNA Advocacy
Several CUNA representatives recently met with Larry Fazio, NCUA's Director of the Office of Examination and Supervision, and key NCUA staff, to discuss RBC, MBL and examinations. This meeting also teed up CUNA's Examination and Supervision Subcommittee's visit with Mr. Fazio next month to discuss examination issues, as part of CUNA's overdraft summit.

We specifically discussed the additional minimum capital requirement that is part of the second RBC proposed rule. Many credit unions remain concerned that this authority gives examiners the ability to unilaterally impose extra capital requirements on credit unions that are well above what will be required by the final RBC rule. We also discussed the calculation of goodwill for pre-RBC mergers, because CUNA members want a final RBC rule to have a permanent grandfather for goodwill for mergers that have or may happen before any final RBC rule is passed by the NCUA Board.

We also discussed the recent MBL proposal. While we support NCUA's effort, we stressed that the proposal does not contain a safe harbor for credit unions seeking to run simple commercial lending programs. We discussed adding a specific safe harbor for credit unions that are not seeking to explore the contours of the regulation. We believe that such a provision would make many credit unions feel comfortable in knowing the minimum expectations for a commercial lending program, and would be particularly useful for credit unions in the early stages of business lending.

While we briefly discussed ways to ease the burden on credit unions from NCUA exams, including returning to the eighteen month exam cycle, we look forward to a much more detailed discussion with Mr. Fazio next month. You can read our full letter to Mr. Fazio here