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).