On the eve of tomorrow's NCUA's meeting on ways to restore the NCUSIF as a result of losses caused by the conservatorship of U.S. Central Federal Corporate Credit Union and Western Federal Corporate Credit Union, NAFCU today urged the agency's board to ask Congress to spread out the repayment period over eight years.

"Should restoration of the NCUSIF not be increased to a minimum of eight years, we believe that our industry's ability to provide low-cost consumer and small business loans, keep member services at low prices and support President Obama's plans for economic recovery will be considerably inhibited," NAFCU President Fred Becker wrote in a letter to NCUA Chairman Michael E. Fryzel, with copies sent to the other board members.

He noted that the cost of rescuing corporates has increased from $4.7 billion to $5.9 billion. As a percentage of insured shares this amount translates to 99 basis points. As of December 2008, the number of federally insured credit unions that have negative net income is 1,830 or 23.4 percent of the total. At a cost of 99 basis points, the number of federally insured credit unions that would have negative net income would increase to 6,038 or 77.4 percent, according to NAFCU's analysis.