NCUA Chairman Debbie Matz gave a subtle answer to those who havecalled for a moratorium on corporate assessments in a Letter toCredit Unions posted on the regulator's website Thursday.

Matz didn't say the NCUA will charge a 2014 corporateassessment, but she did point out that after the 2013 assessment ispaid, the estimated remaining corporate stabilization costs of $900million to $3.2 billion don't account for the timing of cashinflows and outflows that determine the actual figure.

“Remaining cash flows include guaranty payments on some NGNs,assets remaining to be monetized from the failed corporates, andsome projected residual value remaining from the legacy assetscollateralizing the NGNs that will not be available until the NGNsmature,” Matz said.

The NCUA will continue to evaluate on an annual basis acombination of factors that determine annual corporate assessments,she said, which include independent modeling of projected cashflows by asset management firm BlackRock, the impact of theassessment on the credit union industry, the actual performance ofthe legacy assets, and the projected conversion of other corporateassets in the asset management estates into cash.

After the NCUA board set the 2013 corporate assessment rate at8 basis points at the July 25 meeting, CUNA President/CEO BillCheney released a statement calling for the NCUA to eliminate orreduce future payouts.

“We strongly urge NCUA to consider, in the future,minimizing or even eliminating future corporate stabilization fundassessments, based on today's action by the NCUA Board,” hesaid.

“Our analysis indicates that this year's assessment amount ofabout $700 million could well be sufficient to cover the remaininglosses on the legacy assets acquired from the five failed corporatecredit unions,” Cheney said.

The $700.9 million the NCUA expects to receive from theassessment will be applied to outstanding borrowings from the U.S.Treasury. After repaying at least $650 million from the assessment,the NCUA will have a remaining borrowing line of nearly $2 billion,which it would use to cover liquidity needs from both corporatestabilization and the NCUSIF. The $650 million payment will leave alittle more than $4 billion outstanding to the Treasury.

Matz also provided information in the letter about theassessment, including its effect on industry net worth and paymentand accounting details.

All federally insured credit unions will receive an invoice forthe assessment in September; the payment is due by Oct. 16.However, she said credit unions should have expensed the assessmentin July.

Additionally, the entire expense must be reported on the Sept.30 Call Report's income statement using the Temporary Corporate CUStabilization Fund Assessment line, which is account code 311.

While the 2013 assessment will improve the NCUA's bottom line,it is projected to reduce ROA for the credit unions it regulates by7 basis points and the aggregate net worth ratio by 6 basis points.As of March 31, the industry's average ROA was 0.83% and net worthwas 10.31%.

NCUA examiners will continue take into account the impact of theassessment when evaluating and rating earnings and net worthperformance. Matz said. The evaluation of earnings focuses on manyfactors, including a credit union's risk profile, operationalstructure and strategic plans.