NASCUS Meets with Treasury, NCUA Board Members and Industry to Discuss Supplemental Capital, Other Issues

March 1, 2010 — Supplemental capital and the corporates were hot topics of discussion during NASCUS' recent business meetings in conjunction with the CUNA Government Affairs Conference (GAC). NASCUS met with NCUA Chairman Debbie Matz and Board members Gigi Hyland and Michael Fryzel, as well as U.S. Treasury Assistant Secretary Michael Barr to discuss critical issues for the state credit union system.

Members of the NASCUS Board met with Treasury's Barr to primarily discuss the importance of supplemental capital for credit unions. NASCUS explained that credit unions must be able to raise capital outside of retained earnings and encouraged Treasury to support this reform. NASCUS state regulators have long understood the regulatory uses of supplemental capital and explained to Barr that supplemental capital will only be used under strict parameters and regulatory approval.

NASCUS believes that while supplemental capital is not for every credit union, it should be an option. NASCUS continues to advocate for the necessary legislative changes as well as work with the NCUA on the regulatory considerations for supplemental capital. Barr expressed his willingness to continue the conversation on capital reform as the issue progresses both with NCUA and with Congress.

In meetings with the NCUA Chairman and Board members Hyland and Fryzel, NASCUS discussed supplemental capital as well as NASCUS' forthcoming comment letter on the proposed rule regarding the corporate credit union system. NASCUS explained our perspectives on the oversight and supervision of the corporate credit union system, and the areas of the proposed rule, primarily board governance and investments, that are matters of state law for state-chartered corporates. NASCUS will file its comment letter by the March 9 comment filing date; it will be posted on the NASCUS website after filing it with the agency.

During the CUNA GAC, NASCUS' leadership also met with representatives from credit union system associations, including CUNA, CUNA Mutual Group, the National Association of Federal Credit Unions, the American Association of Credit Union Leagues and the Association of Corporate Credit Unions.

NASCUS' leadership will conduct in-person business meetings in June in Chicago.