June 20, 2019

At its sixth open meeting of 2019, NCUA approved a proposed rule delaying the effective date of its risk-based capital rule to January 01, 2022. Comments on the proposed rule must be received within 30 days after publication in the Federal Register. During the extended delay period, the NCUA’s current prompt corrective action requirements would remain in effect.

The proposed delay will provide the NCUA Board time to holistically consider additional improvements to credit union capital standards, such as subordinated debt authority, capital treatment for asset securitization, and a community bank leverage ratio equivalent for credit unions. It also will give the agency time to integrate changes into the rule before it goes into effect.

The Board approved the risk-based capital rule at its October 2015 meeting and scheduled it to go into effect January 01, 2019. At its October 2018 meeting, the Board unanimously approved a rule that delayed the effective date to January 01, 2020 and raised the asset threshold for a complex credit union from USD 100 million to USD 500 million. Based on Call Report data from the end of 2018, if the risk-based capital rule of NCUA were to go into effect today, 545 complex credit unions would be subject to its requirements and more than 99% of all complex credit unions would be considered well-capitalized.

 

Related Link: Press Release

Comment Due Date: FR + 30 Days

Effective Date: January 01, 2022

Keywords: Americas, US, Banking, Credit Unions, Risk-Based Capital Rule, NCUA

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