(Feb. 19, 2021) NASCUS President and CEO Lucy Ito commended all three board members for their vigilance in monitoring the insurance fund equity ratio, “especially in light of the root cause for the downward pressure on the ratio: a dramatic and likely continuing increase in insured shares related to economic stimulus payments, and not unsafe or unsound operating practices by credit unions.”

She also agreed with comments by both Vice Chairman Hauptman and Board Member Hood that the agency must proceed carefully regarding a premium, and with Harper about any decisions made about a premium be data driven.

“NASCUS is also intrigued by the suggestion of possible congressional action to expand the investment authority of the insurance fund that would maximize yield while assuring the protection of the fund,” Ito said, noting comments made by Harper during the meeting. “The state system will be studying the statutorily permissible investments by the NCUSIF compared to the FDIC to inform potential legislation.”

(Dec. 18, 2020) NASCUS President and CEO Lucy Ito, in a press statement, praised the NCUA Board for finalizing the subordinated debt rule, noting the state system’s long support for such action.

“The state system has long said that subordinated debt should be a part of the risk-based capital framework because it encourages well-managed credit unions to attract additional loss-absorbing forms of capital that they would otherwise forego,” said NASCUS President and CEO Lucy Ito. “The risk-based capital rulemaking itself is intended to increase the capital buffer standing of a credit union before any effect on the share insurance fund, and subordinated debt is consistent with that goal.”

Ito also thanked the board for moving forward on the final rule, which has been in the works for at least four years. She said NASCUS and state regulators look forward to working closely with NCUA in preparing for the implementation of the subordinated debt rule, and related capital rules, given the state system’s familiarity and experience with this form of capital

LINK:
Press statement by Lucy Ito on subordinated debt adoption