NCUA Chairman Debbie Matz said she fully recognizes the legitimate anger many feel as a result of corporate credit union losses. Many blame the NCUA, particularly at seized U.S. Central FCU and Western Corporate FCU, where two examiners worked on-site.
"NCUA definitely shares some of that blame," Matz told those attending yesterday's Texas Credit Union League annual meeting in Grapevine, Texas. She added, "So do the managers and boards of those corporates who exercised such poor judgement."
However, much of the blame falls outside the credit union industry, she said, calling out mortgage brokers and ratings agencies for their role in creating $50 billion worth of toxic assets the NCUA is currently attempting to separate from corporate balance sheets.
Assessing blame is only productive to avoid repeating mistakes; NCUA has been doing that for the past year, and the result are proposed corporate rules, she said. Stronger capital standards, better asset liability management, stricter risk concentration controls and higher standards for corporate boards will fix the four primary flaws in existing corporate rules.
"Achieving our goals in these four areas will go a long way toward preventing another corporate crisis from ever occurring," she said.
NCUA will be making "further improvements" to proposed rules as a result of suggestions received during the comments period, she added.