If credit unions see a temporary surge in deposits after Bank Transfer Day on Saturday, they have two options to calculate the changes to their net worth ratio, the NCUA has reminded its examiners.
Credit unions can calculate their net worth by using “point-in-time” assets or using a rolling average of assets.
In its memorandum, the agency’s Office of Examination & Insurance noted that for credit unions that choose the averaging method, the agency should “take into consideration the potentially transient nature of some of these deposits.”
“However, depending on how ‘sticky’ the deposits are, the credit union may only get temporary relief from the net worth effects of a successful Bank Transfer Day,” the memo said.
The agency also noted to its examiners that if credit unions keep the new deposits for several months, examiners should ensure that they update their capital retention plans.