OTR issued for 90-day comment period;
‘an unprecedented opportunity'
Jan. 21, 2016 -- Whether the overhead transfer rate should be determined by a formula or set at the discretion of the NCUA Board -- and what adjustments or changes, if any, should be made to the current calculation – are among the questions posed for comment on the rate’s methodology by the board as a result of Thursday’s meeting.
The board voted, 3-0, to issue the comment call on the overhead transfer rate (OTR) for a 90-day period.
NASCUS President and CEO Lucy Ito said the opportunity for state regulators and credit unions to weigh in on the OTR was “unprecedented.” But, she also noted, “it’s about time.”
“For years, state regulators and credit unions have sought the chance to weigh in on the overhead transfer rate to address the inequities of the current system,” Ito said. “The NASCUS legal analysis released last summer, in fact, found that that the OTR is a rule and should be subject to notice and comment.”
Ito noted that NCUA “has voluntarily” considered the view expressed in the analysis, and taken the step to issue to rate for notice and comment. But, she indicated, there remains much work to do in the future.
“Although we are still poring over the agency’s 112-page document and considering the details of the comment call, we urge as many state regulators and state credit unions as possible to file their own comments over the n90-day comment about the OTR and address a system in imbalance,” she said.
Among the other items the NCUA Board is seeking comment on with regard to the OTR are the definition NCUA uses for insurance-related activities, and; alternate methodologies to arrive at an accurate and fair allocation of costs.
In other action at the Thursday’s meeting, the NCUA Board:
- Approved issuing the federal credit union operating fee methodology for a 90-day comment period;
- Approved release of the agency’s 2017-21 draft strategic plan for a 60-day comment period. During discussion, NCUA Board Chairman Debbie Matz noted that the agency may revert to an 18-month exam cycle for credit unions that pose less risk to share insurance fund. “We are exploring that possibility,” she said.
- Approved a final rule on the reporting structure for the agency’s Office of Minority and Women Inclusion (OMWI), which moves the director of Equal Employment Opportunity (EEO) responsibility from the agency’s executive director to the director of OMWI and revises the OMWI director’s reporting line from the executive director to the NCUA Chairman.