Worried teeth are gnashing today as experts mull the import of what are at first glance highly complicated changes in Part 704 rules proposed by NCUA at its Monday board meeting.

The NCUA summary reads: “The proposed rule contains technical amendments to Part 704, NCUA’s rule governing corporate credit unions.  The amendments would:  (1) delete the definition of “daily average net risk-weighted assets” in §704.2; (2) revise the definition of ‘net assets’ in §704.2 to exclude Central Liquidity Facility stock subscriptions; (3) revise §704.6 to clarify certain requirements regarding investment action plans; (4) clarify the weighted average life (WAL) tests in §704.8; (5) revise the consequences of WAL violations in §704.8; (6) substitute the term ‘core capital’ for the phrase ‘the sum of retained earnings and paid-in capital’ in §704.18; (7) correct the heading of §704.19; and (8) correct a date contained in Model Form D of Appendix A to part 704.”

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