Posts By: Shawna

NACUSO Supports Transparency on OTR

NACUSO has long expressed its concern about the growth of NCUA and its extension of its regulatory arm, both directly and indirectly, into areas of questionable statutory authority such as the de facto regulation and examination of CUSOs through the 2013 CUSO rule that is beginning to be implemented by NCUA this year.  The extension of regulatory authority by NCUA comes with increased costs, costs that are paid for ultimately by credit union members. NCUA not only wants expanded regulatory authority over CUSOs, it also is seeking regulatory authority over all vendors that sell products and services to credit unions.

NCUA takes money from the insurance fund to pay for its operations through the Overhead Transfer Rate (“OTR”).  The OTR currently funds 71.9% of NCUA’s budget.  NCUA does not have to justify its expenses or ask permission from anyone to take as much money as it deems appropriate from the share insurance fund for its operations. … Read more

Vendor Authority Amendment Stopped 8-5-15

Yesterday,  On August 5th, Senator Warren attempted to amend the cyber security bill with an amendment that went far beyond cyber security and was designed to authorize NCUA to examine every third party credit union vendor from CUSOs to check processors to the cleaning service at the branches.  Because we are concerned about agency overreach into direct CUSO regulation and examination, we do not want to see third party vendor authority granted to NCUA for we can see its tentacles only growing over time in a way that could have a chilling effect on CUSO investment and the collaborative power of credit unions.   NACUSO mobilized with our legislative advocacy partners to halt any progress on this unnecessary amendment, and  the amendment was not added to the Cyber Security Bill.  NACUSO emailed the attached letter to the Senate Leadership yesterday afternoon, explaining our opposition to NCUA’s request for Vendor Authority.  We will continue to monitor the situation to ensure that the Senate and House recognize that such an unwarranted extension of regulatory and examination authority beyond the current statutory mandate of NCUA is both controversial in the industry and potentially damaging to an industry that is dependent upon third party relationships because of their smaller size in comparison to many of their competitors. 
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NACUSO Legislative & Regulatory Advocacy Plan

As we explained when we announced the formation of the NACUSO Advocacy Fund a few months ago, the regulatory climate that enabled credit unions to maximize the benefits of CUSOs and collaboration is under siege, and as an industry, we need to respond.  NACUSO has established an Advocacy Fund to supplement its efforts to promote and protect a collaboration/CUSO friendly regulatory climate.

As was announced at the NACUSO Annual Conference, we have developed a NACUSO 2015-16 Legislative & Regulatory Advocacy Plan, based upon the four basic precepts upon which our advocacy work is based.  Those four pillars are designed to support an environment that:… Read more

NACUSO Comment Letter on NCUA’s proposed Risk-Based Capital regulation

NACUSO has filed its official Comment Letter with the NCUA addressing their revised Risk-Based Capital (“RBC”) regulation, and we are providing it to you so you will be aware of our position on this very important issue.  We have also included a “sample” comment letter that you can use as a template for your own comment letter to the NCUA regarding the revised RBC proposal.

While we acknowledge and appreciate the improvements in some risk weights from the original RBC proposal, including reducing the risk weighting on wholly owned CUSOs to 100%, we remain concerned with a 150% risk weighting on CUSOs that are owned by multiple credit unions.  The CUSOs that are owned by more than one credit union are providing much needed economies of scale, helping to obtain levels of expertise that an individual credit union may not be able to afford or obtain on their own, while helping to share/spread risk and lower costs. … Read more