X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

Western Corporate Federal Credit Union President/CEO Philip Perkins spoke out against some proposed NCUA corporate regulations in a letter to members that was obtained by Credit Union Times. In the letter, Perkins said that, as currently written, the new rules have a “number of elements that would have a detrimental impact on credit unions.”Writing the letter to assist members in preparing their own comments for the NCUA, the WesCorp chief executive specifically objected to the regulator’s proposed certificate premium redemption restriction, new NEV tests, and asset-weighted average-life limits applied to member loans.Perkins, who previously ran Delaware Investments’ mortgage-backed securities unit and was a managing director of global markets at Deutsche Bank in London, said, “If WesCorp had to adjust the paid yield to compensate the holder-buyer for the inability of its investment to go over par price, we would not issue certificates because we would not be able to offer investments that would not lose money.”He said proposed NEV tests are so restrictive, they “prevent corporates from doing business altogether.” An all-Treasury portfolio would pass the new NEV test, he said, but would not produce retained earnings and would actually lose money.Furthermore, applying proposed asset-weighted average-life limits to member loans could entice corporates to “up-price loans” to counter using up weighted average-life capacity, he said.“This would profoundly restrict the likelihood of corporates being able to serve any of your mid- to long-term liquidity needs-one of the driving ideas behind the original foundation of the corporate credit unions,” he said.NCUA Director of Public and Congressional Affairs John McKechnie reacted to the letter by saying, “The comment period on the proposed corporate rule is open until March, and NCUA welcomes any and all responsible input. The opinions received will be instrumental in the NCUA’s work toward reforming the corporate system.”–[email protected]

Complete your profile to continue reading and get FREE access to CUTimes.com, part of your ALM digital membership.

Your access to unlimited CUTimes.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Critical CUTimes.com information including comprehensive product and service provider listings via the Marketplace Directory, CU Careers, resources from industry leaders, webcasts, and breaking news, analysis and more with our informative Newsletters.
  • Exclusive discounts on ALM and CU Times events.
  • Access to other award-winning ALM websites including Law.com and GlobeSt.com.

Already have an account?

Credit Union Times

Join Credit Union Times

Don’t miss crucial strategic and tactical information necessary to run your institution and better serve your members. Join Credit Union Times now!

  • Free unlimited access to Credit Union Times' trusted and independent team of experts for extensive industry news, conference coverage, people features, statistical analysis, and regulation and technology updates.
  • Exclusive discounts on ALM and Credit Union Times events.
  • Access to other award-winning ALM websites including TreasuryandRisk.com and Law.com.

Already have an account? Sign In Now
Join Credit Union Times

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.