Saying that the threats to the credit union system posed by corporate and natural person credit unions are distinct, the NCUA should revamp the insurance structure to separate the two, NAFCU President Fred Becker wrote the NCUA Board today.
"It is NAFCU's belief that the industry-wide crisis has made it apparent that the risks posed by the corporates and natural person credit unions are so different that it is no long advisable for NCUA to insure them under one share insurance structure without implementing additional measures to protect natural person credit unions. We ask that NCUA create a permanent buffer between the corporates and natural person credit unions either though a capital regime or other mechanism," Becker wrote.
The NCUA is reviewing the structure of the corporate credit union system and recently received comment letters on the topic that it is now reviewing.
Becker also urged the agency to disclose more information that it used to make certain decisions. He requested that the agency reveal the economic assumptions used in performing the stress tests on each corporate credit union and should update the public on the ratings of the securities held by corporate credit unions.
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