MCUL Comment Letter: NCUA Should Reconsider Corporate Credit Union Rules (Misc News: January 31, 2011)
The MCUL is calling on the NCUA to reconsider its plans to limit credit unions to membership in just one corporate credit union and equitable distribution of corporate credit union stabilization expenses.
The Jan. 28 Comment Letter signed by MCUL & Affiliates CEO David Adams argued the agency’s proposal to limit corporate credit union membership “will have the undesired effect of merely redirecting competitive efforts outside the federally insured credit union market.”
Click here to view a copy of the MCUL’s Comment Letter. (Password protected)
Credit unions should be able to invest in multiple corporates if the investments “are commensurate with the nature, scope and complexity of the respective credit unions’ investment activities; and the investments would be in the best interests of the respective credit unions’ membership as a whole,” he said.
“MCUL believes that with this proposal, NCUA has announced a 'no confidence' vote in corporate credit unions,” Adams said in the letter. “With all due respect, the Inspector General recommended limitations on corporate investments, not investments in corporates.”
Adams said the Helping Families Save Their Homes Act of 2009 does not grant NCUA with the legal authority to encourage existing non-FICU members to pay their fair share of expenses by making “voluntary” payments to the Temporary Corporate Credit Union Stabilization Fund.
He added that since many corporate FICU members are also members of trade associations and CUSOs, voluntary payments by non-FICUs would result in multiple assessments by corporate FICU members.
“MCUL believes that the result will be the exact opposite of what NCUA intends to rectify,” Adams said.