Statements from NASCUS President and CEO Mary Martha Fortney on NCUA 2014 Overhead Transfer Rate and Credit Union Service Organization final rule
November 21 Today, the National Credit Union Administration (NCUA) Board addressed critical issues for the state credit union system, including the supervision of credit union service organizations (CUSOs) and the agency’s 2014 Overhead Transfer Rate (OTR) and operating budget. The NCUA increased the OTR to 69.2 percent from the previous year's 59.1 percent. The NCUA decreased the federal credit union operating fee by an average of 18.4 percent.
The OTR is the mechanism by which the Federal Credit Union Act allows NCUA to use monies from the share insurance fund for its administration. NASCUS President and CEO Mary Martha Fortney made the following comments regarding the OTR and NCUA's budget.
“NASCUS is carefully reviewing the information made public today by NCUA regarding the dramatic increase to the Overheard Transfer Rate and decrease to federal operating fees,” said NASCUS President and CEO Mary Martha Fortney. “NASCUS continues to believe that the Federal Credit Union Act is clear. The OTR is intended to pay the costs for the share insurance fund's review of state and federal credit union examinations and for limited onsite examination as necessary."
NASCUS is also carefully reviewing the final Credit Union Service Organization (CUSO) rule. NASCUS had raised substantive concerns with the rule as proposed in 2011 and is evaluating how the final rule addressed those concerns. The final rule requires all CUSOs to provide basic profile information directly to NCUA. CUSOs that are engaged in “complex or high-risk activities” are to submit additional data, including audited financial statements and customer information. NCUA staff asserted that sensitive information would be protected from Freedom of Information Act requests under the exemptions for trade secrets and information collected for purposes of examination. NCUA approved a budget of $750,000 for development of the CUSO registry in 2014, with additional estimated expenses of $650,000 in 2015, to be drawn from the insurance fund. All three board members voted in support of the rule. NCUA Board Member Fryzel noted that NCUA obtained an opinion from outside counsel confirming that the Agency has the authority to issue the rule.