Closing the temporary fund meant to resolve troubled corporate credit unions is among the top achievements cited by the federal regulator of credit unions in its annual report for last year.
In its annual report for 2017, the National Credit Union Administration (NCUA) lists five top “most significant actions” for last year. Aside from closing the Temporary Corporate Credit Union Stabilization Fund (TCCUSF) – before its “scheduled expiration of 2021” and transfer of assets to the National Credit Union Share Insurance Fund (NCUSIF) – those other four actions are:
- Implementing an agency-wide realignment that consolidated several agency functions at the start of this year, and deciding to close two regional offices in 2019;
- Making sizeable investments in new technology allowing for remote supervision and examination of credit unions;
- Enhancing the transparency and accountability of the NCUA’s decisions, operations and budget; and
- Moving to provide meaningful and significant regulatory relief.
In February of this year, the NCUA Board approved a $735.7 million “distribution” to be paid to federally insured credit unions, likely during the second half of 2018, the result of a dividend from the federal insurance fund that insures credit union member shares (savings).
The dividend was possible after the board’s decision to close the TCCUSF last October, and to distribute funds remaining to federally insured credit unions after meeting reserve requirements for the NCUSIF.
Under federal law, a distribution is required for any year when the fund closes the year at an equity ratio higher than the normal operating level (now set at 1.39% for the NCUSIF). That distribution must be sufficient to return the fund to the normal operating level but cannot reduce the available assets ratio below 1%.
In a statement accompanying the annual report, NCUA Board Chairman J. Mark McWatters said that in 2018, the agency would advance several initiatives that will further reduce the regulatory burden on credit unions and improve the agency’s operations.”