The NCUA Board hasa unique opportunity to promulgate a regulation that will have apositive impact on small credit unions. At a future board meetingthey will vote on changing the current definition of small entitycredit union from less than $50 million in assets to less than $100million in assets. It is a good move but one that could bebetter.

The current definition of a small credit union was adopted bythe board in 2013 and was the second time it has been changed sinceinitially defined in 1987. The continued changes in the financialservices industry and credit unions specifically dictate a morefrequent review of the threshold and a more robust approach tosetting a standard.

It is significant to note that there is no continuity amongstfederal agencies in the definition of a small entity. But thatshould not surprise anyone. It is rare within the federalgovernment to find agreement on anything.

The Small Business Administration says that a business is smallif its assets are under $550 million, whereas the CFPB uses thefigure of $175 million or less to consider an entity as small. Thedifferences in those numbers reflect quite a range and quite adisparity.

Credit unions are unique. They are not for profit cooperativesowned by their members and provide financial services at betterrates and lower costs than their competition. They are however,financial institutions operating in a competitive environment. Andfor those that maintain strong principles of safety and soundness,although being small in a world of giants, deserve greaterconsideration for regulatory relief.

There appears to be no real consensus on what the best numberNCUA should deem appropriate for the small entity designation. It'snow $50 million; proposed is $100 million with some recommending ashigh as $550 million. Others have suggested adopting either the SBAor CFPB benchmarks.

Perhaps a better approach would be to consider the fact thatNCUA is back changing the definition after only two years. It iscommendable that they did not wait longer, but rather saw the needto take action sooner than later. They should maintain this forwardperspective and rather than just take a baby step proceed with agiant leap and set the asset designation at a more reasonablelevel.

Defining a small credit union as one with assets of less than$250 million is not only a reasonable move but also one that willaccommodate those needing relief from certain regulations the most.In addition, maintaining a two year review of this change willprovide sufficient time to study the new levels impact and providethe board with ample information for future consideration.

Get this one done.