WASHINGTON – Saying he was "deeply concerned," about the "second-place status" of credit unions in the programs in place to help financial institutions, NCUA Chairman Michael E. Fryzel urged Treasury Secretary Timothy Geithner to find ways to establish guidelines for credit unions to access Troubled Asset Relief Program money.
In a letter sent to Geithner on the secretary's day in office, Fryzel urged the administration to change the Bush administration's policy of not using TARP funds to buy illiquid assets and to establish rules for credit unions to participate in the capital purchase program.
Fryzel wrote that while credit unions have mostly avoided the high-profile failures of other sectors of the industry, the stresses that they are facing are "real and tangible."
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He also urged Geithner to develop a program that would enable the National Credit Union Share Insurance Fund to provide insurance for all deposits in non-interest bearing transaction accounts. FDIC-insured institutions provide this coverage but the NCUA lacks the systemic risk authority that would enable it to do the same.
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