The efforts made by credit union advocates during Missouri Hike the Hill are showing positive results. Just one week after meeting with credit union leaders in Washington, D.C., Senator Roy Blunt (R) sent a letter expressing concerns about the National Credit Union Administration's (NCUA) Based Capital (RBC) proposal. Blunt is the ninth Missouri federal lawmaker to weigh in on the proposal. Blunt's letter joins a Congressional letter signed by all eight of Missouri's U.S. Representatives.
In the June 26 letter, Blunt stated that Missouri credit unions contacted him to express their concerns with the proposal.
"I agree with the Missouri credit unions and my numerous House and Senate colleagues that the proposed rule will unintentionally adversely affect the business of credit unions, is inconsistent with current statutory requirements and should be reconsidered by the NCUA," the letter reads. "I ask the NCUA to take into consideration the cost and burden of implementing these new risk-based capital requirements and provide justification as to why, with the limited ability other than retained earnings, an across-the-board approach regarding risk weights is necessary at this time."
Since the NCUA issued its proposal, more than 10 current and former federal legislators have filed individual comment letters. A letter signed by 324 U.S. Representatives, including the Missouri delegation, was also filed.
"Credit union leaders were able to explain credit union concerns about RBC with lawmakers during Hike the Hill and the potential impact on credit union members - their constituents," says Amy McLard, SVP Advocacy for the Missouri Credit Union Association. "We greatly appreciate the support of Senator Blunt regarding credit union concerns about the RBC, and the support of all eight Missouri U.S. House members. These letters help reinforce credit union concerns and the broader impact as NCUA considers the proposal moving forward."
The NCUA's proposal adds a risk-based standard requiring credit unions to hold capital at 8 percent of risk-based assets in order to be considered adequately capitalized, and 10.5 percent to be considered well-capitalized. It would also give the agency the right to require credit unions to hold additional capital on a case-by-case basis.
On May 28, the Missouri Credit Union Association filed a letter with NCUA outlining issues with the proposal. Click here to read the full letter.
Caption: Missouri credit union advocates meet with Sen. Roy Blunt during the 2014 Hike the Hill.