McWatters Optimistic of Corporate Stabilization Fund, Share Insurance Fund Merger
NCUA Acting Chairman J. Mark McWatters said Thursday that he remains optimistic that the agency will be able to fold the temporary corporate stabilization fund into the Share Insurance Fund this year.
“I’ve not seen anything on the accounting side that says this can’t happen,” McWatters said at the board’s April meeting.
McWatters first mentioned his desire to merge the funds in a February speech at CUNA’s governmental affairs conference.
NCUA CFO Rendell Jones tempered McWatters’ optimism a bit Thursday, saying, “We’re still involved in the research.
McWatters said in February that the insurance fund’s equity ratio ended 2016 at 1.27%, below the board-approved normal operating level of 1.3%. Folding the stabilization fund into the insurance fund would help the insurance fund, with the goal of being able to rebate surplus funds to federally insured credit unions.
Also at Thursday’s meeting Jones reported that operating expenses at the agency dropped from an estimated $51.7 million to $44.5 million, with some of the savings coming from a hiring freeze.
President Trump announced a hiring freeze during the opening days of his administration and while independent agencies such as the NCUA are not subject to Executive Orders, NCUA officials have said they were following the “spirit” of the freeze.
Subsequently, Trump lifted that freeze.
Jones also said that the number of “problem” credit unions grew during the first quarter of the year from 196 in December to 197 during the quarter. He said that 88% of those credit unions have less than $100 million.
He said that two credit unions failed during the first quarter; during 2015, 14 credit unions failed.