NASCUS President and CEO Lucy Ito on 5 key points for OTR comments
Video outlines 5 key comment points on OTR (due April 26)
April 14, 2016 -- Five key points about the overhead transfer rate (OTR) methodology for stakeholders to consider in their comments are outlined in a new video by NASCUS President and CEO Lucy Ito.
“April 26 is the comment deadline for the overhead transfer rate methodology,” the NASCUS leader says in the video. “If you haven’t already commented, I strongly urge you to do so.”
The key points that Ito outlines are:
- The OTR is flawed and threatens the dual chartering system. By shifting supervisory costs to the insurance fund, NCUA uses FISCUs to subsidize agency responsibilities. Thus, state and federal charters compete on costs -- with one charter having its costs artificially lowered.
- NCUA – as a chartering authority – has safety and soundness obligations. The agency’s role goes beyond just protecting the insurance fund.
- State-chartered, federally insured credit unions must be treated equitably. NCUA’s unique role as both chartering authority and deposit insurance administrator obligates the agency to fairness.
- The OTR is subject to federal notice and comment requirements. That’s clear under the Administrative Procedure Act – as outlined by the 2015 NASCUS legal study.
- There are better ways. The agency can be consistent with Congress’ intent for the insurance fund – and adopt a more equitable approach.
“NCUA should not have carte blanche in spending credit union system dollars; let’s tell them so,” Ito concludes in the video, urging viewers to visit the NASCUS “OTR Resources” page on the association’s website for more information.