WASHINGTON–The House has passed credit union-backed legislation that includes among its provisions a measure to delay NCUA’s risk-based capital rule. Separately, a CU-backed candidate has also won a runoff race.
The JOBS and Investor Confidence Act of 2018 (S. 488) passed the House in a 406-4 vote. Title XVII of the House Amendment would delay the RBC rule to Jan. 1, 2021 from Jan. 1, 2019.
“We commend the House Financial Services Committee for pushing this legislation through as it rectifies the need for unnecessary capital requirements on credit unions,” said CUNA President/CEO Jim Nussle in a statement. “Credit unions across the country have expressed their well-founded concerns regarding NCUA’s risk-based capital rule and their voices have been heard."
CUNA had earlier sent a letter to address NCUA's parameters of legal authority to impose risk-based capital requirements and call into question whether the cost is justified. The trade group said its analysis showed the regulatory burden would have done very little to reduce costs to the National Credit Union Share Insurance Fund (NCUSIF) had it been in effect during the most recent financial crisis.
NAFCU Response
Meanwhile, NAFCU CEO Dan Berger said, "NAFCU applauds the bipartisan work of Chairman Hensarling and Ranking Member Waters in crafting the JOBS and Investor Confidence Act of 2018, and we appreciate the support of all House lawmakers who voted in favor of this legislation. A two-year delay of the NCUA's risk-based capital rule will give credit unions more time to comply with the rule and the agency time to make some necessary changes.
"While NAFCU supports an appropriate risk-based capital system for credit unions, this rule – as currently written – will only have a negative impact on the industry," Berger continued. "We thank leaders and members of the House for recognizing the increased burden and costs this rulemaking would bring."
CU-Backed Candidate Wins
Separately, the candidate credit unions were backing in the runoff in the Republican primary in Alabama’s second district has won the race.
CUNA, the Credit Union Legislative Action Committee (CULAC) and the League of Southeastern Credit Unions had been supporting Rep. Martha Roby, the incumbent, in the race against challenger Bobby Bright, a former congressman. Roby won more than two-thirds of the vote.
The winner of the race will face Democrat Tabitha Isner in November’s general election.