More than 200 people filled the NCUA's Jan. 22 town hall meeting to capacity and then some. Buddy Gill, chief advocacy officer for the Texas Credit Union League, attended the meeting and described the collective audience mood as "skeptical, but not combative."

As it was the first town hall event since the regulator unveiled its proposed corporate rules, corporate issues dominated the four-hour session. The panel of NCUA Chairman Debbie Matz, Board Member Michael Fryzel and senior staff also discussed proposed changes to the field of membership rules, credit union capital, member business lending and regulatory restructuring.

"Today's session yielded serious and important discussions that touched on the most significant issues facing the credit union industry," Matz said. "I am encouraged by the continuing dialogue at the town hall meetings and look forward to applying this valuable information as we move toward a final rule."

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Gill said feeling skeptical after losing money on an investment is "just human nature."

"But, I think people are beginning to realize that the failure was systemic, and not necessarily the responsibility of just a few individuals," he added.

While one attendee did press Matz to admit the regulator's share of blame for corporate losses, Gill said most of his constituents have moved past assigning blame and are more concerned about finding solutions.

Using the stages of grief as an analogy, Gill said, "We've already been through anger, denial and blame, and I think now we're in the grief stage, as credit unions brace themselves to lose all of their corporate capital."

Dallas-based Southwest Corporate Federal Credit Union is expected to apply losses to member-contributed capital this month, Gill said. While much of the focus to date has been on the two corporates placed under conservatorship, Western Corporate Federal Credit Union and U.S. Central Federal Credit Union, he said Southwest Corporate's pending capital write-down "hits home" with Texas credit unions.

However, he had little criticism for the NCUA, saying the regulator is "trying to thread a needle" in writing new corporate regulations.

"They have their work cut out for them, striking a balance between preventing these losses from happening again, yet maintaining successful corporate business model," Gill said. "It's a very narrow area in which to work, and I believe they genuinely want this to be successful, but they need credit unions to tell them what will and won't work."

Gill also said NCUA representatives hinted they have already made adjustments to proposed corporate rules based on industry feedback.

Credit unions attending the meeting represented smaller asset classes than previous NCUA Town Hall meetings, Gill said, and as a result, requested more assistance from the regulator to help their executive teams and volunteers understand the complex proposed rules.

NCUA spokesman John McKechnie, responding via e-mail, said the agency does plan to provide additional educational information on the subject in response to the Jan. 22 requests but was unable to provide details.

The NCUA's next scheduled town hall meeting will be on Feb. 4 in Lake Buena Vista, Fla.

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