Credit unions would get an additional two-year reprieve from federal risk-based capital rules under legislation marked up and reported out by a House committee Tuesday.
The House Financial Services Committee voted 53-0 to approve H.R. 5841, the Foreign Investment Risk Review Modernization Act of 2018, along with four other bills Tuesday. The measure’s primary focus is to “modernize and strengthen” the Committee on Foreign Investment of the United States (CFIUS).[A separate CFIUS modernization bill, S. 2098, was reported out by the Senate Banking Committee Tuesday.]
The two-year delay in H.R. 5841 applies to the RBC rule approved in 2015 by the National Credit Union Administration (NCUA) Board. Currently scheduled for implementation Jan. 1 of next year, the rule revises the agency’s “prompt corrective action” rules, replacing the current risk-based net worth requirement with a new risk-based capital ratio for federally insured, natural person credit unions.
NCUA, in issuing the final rule, said the RBC requirement is more consistent with the agency’s risk-based capital measure for corporate credit unions and more comparable to regulatory risk-based capital measures used by the Federal Deposit Insurance Corp. (FDIC), Board of Governors of the Federal Reserve System (Fed), and Office of the Comptroller of Currency (OCC). The original effective date was intended to coincide with a full phase-in of FDIC risk-based capital measures in 2019.
H.R. 5841 was introduced May 16 and referred to five House committees: Foreign Affairs, Financial Services, Energy and Commerce, Intelligence (Permanent Select), and Oversight and Government Reform.
H.R. 5841, the Foreign Investment Risk Review Modernization Act