NASCUS COMMENTS ON THE NCUA SUBORDINATED DEBT PROPOSED RULE

For Immediate Release

July 9, 2020

CONTACT: Shelton Roulhac, NASCUS Communications; [email protected]

NASCUS COMMENTS ON THE NCUA SUBORDINATED DEBT PROPOSED RULE

NASCUS supports the rulemaking but recommends a less prescriptive approach to facilitate innovative offerings.

 ARLINGTON, Va. – In response to the NCUA’s request for comments on its Subordinated Debt proposed rule, NASCUS has written a comment letter supporting the Agency’s efforts to include Subordinated Debt into the calculation of a credit union’s regulatory capital and offering recommendations that would foster continued modernization of the capital framework.

“For over 20 years, NASCUS has advocated for all credit unions – low-income designated, complex, and newly chartered – to have the ability to issue Subordinated Debt for regulatory capital treatment and we commend the NCUA for heeding our call and taking steps to develop a Subordinated Debt rule,” said NASCUS President and CEO Lucy Ito. “While the development of a Subordinated Debt rule is an arduous task, it will bring profound benefits to the credit union industry including, helping credit unions and their members, protecting the share insurance fund, and placing natural person credit unions in the United States on par with credit unions and other depository institutions worldwide.”

Despite NASCUS championing “a broader, more flexible Subordinated Capital rule,”  Ito noted that a Subordinated Debt rule is a logical starting point for the NCUA rulemaking and offered recommendations to the proposed rule that would create greater flexibility and foster the innovation needed for the development of a robust Subordinated Debt marketplace.

“Since 1998, State Regulators and NASCUS have heralded that permitting all credit unions to have access to Subordinated Debt is sound public policy and we stand ready to collaborate with NCUA to make credit union capital reform a reality.”

The NASCUS comment letter can be found here.

Information Contact:
Shelton Roulhac, Vice President, Communications, [email protected] or (703) 528-5974

 

NASCUS is the national association that advocates for a strong and healthy state credit union system, and whose members include state regulatory agencies, credit unions, credit union leagues, and organizations that support the state credit union system.