NCUA 2019 annual report outlines reg initiatives, industry stats, share insurance fund financials

The federal regulator of credit unions late Friday released its 2019 annual report, which recaps the agency’s actions to create a regulatory framework that is “effective without being excessive,” including the agency board’s decision to delay by two years the implementation of a risk-based capital rule for credit unions.

The agency, announcing the report, noted the following highlights of the previous year:

  • A two-year delay of the implementation of the risk-based capital rule “to allow time for further review and holistic improvements”;
  • A final rule that raised the threshold on the level of public unit and non-member shares a credit union can receive;
  • A final rule raising the threshold for commercial real estate transaction appraisals from $250,000 to $1 million;
  • New guidance on secondary capital plans for low-income designated credit unions;
  • A final rule clarifying and updating federal credit union bylaws to provide greater flexibility in governance while protecting members’ rights and engagement.
  • Hosting of the inaugural Diversity, Equity, and Inclusion Summit, attended by credit union industry stakeholders and to be held annually;
  • Guidance to federally insured credit unions so they may provide certain financial services to legally operating hemp businesses;
  • A final policy statement that extends “second-chance” opportunities to job applicants with minor, non-violent criminal offenses in their past; and
  • A final payday alternative loans rule (PALs II) enhancing credit unions’ ability to serve members who need short-term, small-dollar loans.

The report shows that the National Credit Union Share Insurance Fund (NCUSIF), as of Dec. 31, 2019, insures $1.2 trillion in member shares in approximately 5,200 credit unions. The fund closed 2019 with an equity ratio of 1.35%.

For 2019, there were two credit union failures at an estimated cost to the fund of $40.3 million. It notes the eight failures of 2018 cost the fund some $785 million (most of that related to failures of credit unions heavily invested in taxi medallions).

NCUA 2019 annual report