The Missouri Credit Union Association (MCUA) would like to pass on a recent statement from the Credit Union National Association (CUNA).
Statement by CUNA President and CEO Bill Cheney: On adoption by NCUA Board of ‘stress test’ rule for large credit unions
The Credit Union National Association (CUNA) did not support this proposal. While we acknowledge the utility of stress tests, we see no need for a rule. Further, the agency has not sufficiently substantiated a need for the use of third parties to conduct stress testing of covered credit unions, rather than reviewing the assumptions and results of credit unions’ own stress tests.
We appreciate that the agency has adopted some changes that we suggested—such as not disclosing results publicly—and has agreed to allow credit unions to apply to have results of their own tests used for these purposes. However: The cost for the program—which must be borne by all federally insured credit unions—is now up to $5 million for the first year, which we believe is just too much.
It is crucial that National Credit Union Administration (NCUA) apply the rule as judiciously as possible, particularly since the vote on final approval was split, 2-1 (and board members signaled their willingness to consider future changes). We encourage the agency to do all it can to work with the covered credit unions and CUNA in the development of guidance. The agency should also work to contain costs wherever possible.