ALEXANDRIA, Va.–The NCUA board Thursday voting to close the Temporary Corporate Credit Union Stabilization Fund (TCCUSF) and merge it into the National Credit Union Share Insurance Fund (NCUSIF) to pave the way for rebates in 2018 has CUNA and NAFCU—no surprise—holding opposing viewpoints on the decisions.
As CUToday.info reported, the board also voted in favor of increasing the Normal Operating Level (NOL) of the insurance fund to 1.39%.
NAFCU, which ahead of the meeting emphasized that the trade association and its members opposed the proposal, and that it advocated for a full TCCUSF refund on behalf of all credit unions, said Thursday’s actions “set the stage for the NCUA to retain almost $1 billion from the merger of the funds. Credit unions are expected to receive a refund from the agency in the amount of $600 million to $800 million in 2018. This amounts to credit unions being refunded only about 15% of their original assessments made to the TCCUSF.”
"NAFCU and the credit unions we represent appreciate the NCUA's work on this issue, but this approach and outcome are not ideal," said NAFCU President and CEO Dan Berger. "Raising the NOL by 9 basis points is unprecedented and unnecessary. Two-thirds of all who commented on the proposal - including our members - opposed such a dramatic increase and rightly so."
Meanwhile, CUNA President/CEO Jim Nussle called NCUA’s moves a “victory for credit unions.”
“The NCUA board voted to ensure that credit unions will receive the funds they deserve 2018. We thank Chairman (Mark) McWatters and board member (Rick) Metsger,” said Nussle. “This is a win for credit unions because they are the best stewards of credit union resources. More than 90% of credit unions who weighed in during the comment period were in favor of CUNA’s position.”
CUNA had raised concerns about NCUA’s proposal to set the normal operating level at 1.39% and advocated it be lowered.
"CUNA wrote to the agency saying the proposed NOL was too high, but the agency indicated it was retaining this level to provide additional cushion to the share insurance level if there were to be an economic downturn,” said Nussle. “Going forward, we will continue to engage with the agency to ensure any raise is merely temporary.”