CHICAGO – The NCUA won't allow the NCUSIF's equity ratio to fall below 1.2% for long because doing so would be "irresponsible," NCUA Chairman Debbie Matz said today at a luncheon address at NAFCU's Annual Conference.

She also told attendees that it is "not practical to try to manage the ratio to just a few basis points above the statutory minimum of 1.0%."

She said if current trends in credit union losses continue, the fund's equity ratio -currently 1.22%– is likely to fall below 1.2% by the fall. In response to some of these financial problems, CUNA and NAFCU had asked the agency to consider letting the fund drop below 1.2% to minimize the assessment that would be levied on credit unions but Matz said the board would consider keeping the ration a few basis points below 1.2% "for a limited."