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RBC2 Final Rule Part of NCUA’s Oct. 15 Meeting Agenda
Tuesday, October 13, 2015 6:45 AM

The finalized version of the National Credit Union Administration’s revised risk-based capital (RBC2) proposal is on the agenda for the agency’s Oct. 15 meeting. NCUA released its agenda, which lists the final RBC rule as an item for consideration.

The agency issued RBC2 in January after its original proposed rule was introduced last year. The revised proposal has a number of improvements, but Credit Union National Association continues to believe that it's a solution in search of a problem.

CUNA noted roughly 25 key improvements over the agency’s first risk-based capital proposal, including:

  • Limiting the scope of the proposal by increasing the asset threshold to $100 million;
  • Lowering the risk-based capital requirement for well-capitalized credit unions;
  • Improving risk weights; 
  • Permitting goodwill in supervisory mergers to be included in risk-based capital; and 
  • Delaying compliance until Jan. 1, 2019.

In a letter sent to legislators last week, NCUA Chair Debbie Matz said, "The final risk-based capital rule will be calibrated to affect only a few dozen credit union outliers not carrying sufficient capital to match the risks on their balance sheets."

CUNA requested the NCUA make those calibrations, and suggested other items as well, including:

  • The new proposed capital adequacy provisions beyond net worth and risk-based capital ratio requirements should be dropped;
     
  • The identification of “complex” credit unions should be based on something more than asset size, and should include only credit unions with at least $500 million in assets; and
     
  • Implementation should be delayed until 2021, to coincide with expected refunds from the Temporary Corporate Credit Union Stabilization Fund.

The other items on the agenda include a proposed rule on bank notes, delegations of authority for the approval of community charter requests, and a quarterly update on the National Credit Union Share Insurance Fund.