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America’s Credit Unions called on the NCUA to reassess the capital framework applied to credit unions, citing recent actions by federal banking agencies to ease capital requirements for community banks.
In a letter sent this week to NCUA Chairman Kyle Hauptman, Andrew Morris, the group’s senior counsel for innovation and technology, urged the agency to consider reforms that can be undertaken under its existing authority. These include adjustments to the Complex Credit Union Leverage Ratio (CCULR), amendments to the subordinated debt rule, revisions to the asset threshold defining complex credit unions to reflect inflation and industry growth, and recalibration of stress test capital tiers.
“As economic conditions change, capital requirements for credit unions should adapt to ensure that industry earnings are being put to productive use, helping members and fueling American growth rather than merely accumulating to satisfy outmoded perceptions of risk,” Morris wrote.
The letter noted that Federal Reserve Governor Michelle Bowman recently highlighted the importance of capital flexibility for community institutions, while banking regulators have pursued similar relief measures. Credit unions, Morris argued, deserve comparable consideration to ensure they can continue to meet member needs without being constrained by rigid or outdated rules.
America’s Credit Unions framed the request as part of a broader push to align capital standards with the unique mission of credit unions, allowing them to “better serve members while maintaining a safe and sound system.”
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