NCUA Boardroom. Credit/NCUA
America's Credit Unions has formally requested that the NCUA reassess the current Normal Operating Level (NOL) of the National Credit Union Share Insurance Fund (NCUSIF), advocating for a reduction to balance taxpayer protection with minimized premium charges to credit unions.
In a letter dated March 19 from Regulatory Advocacy Senior Counsel Luke Martone to NCUA Chairman Kyle Hauptman, America's Credit Unions emphasized the importance of revisiting the NOL, which has remained at 1.33% since its reduction from 1.38% in 2022. The organization underscored that a lower NOL would allow credit unions to allocate more resources toward serving their members and communities.
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"Prior to your designation as Chairman, the NCUA had indicated its intent to review the NOL," the letter stated. "Although we recognize that the change in administration has brought about a shift in NCUA priorities, we strongly believe that this initiative should remain a priority in 2025."
The NOL represents the equity ratio target for the NCUSIF, determining the fund's capacity to absorb losses and protect member deposits. America's Credit Unions contends that the current level may be higher than necessary, potentially leading to unwarranted premium assessments on credit unions.
The letter further noted that reviewing the NOL aligns with recent executive orders aimed at deregulation, suggesting that such a review should be "prioritized for its ability to reduce costs for credit unions and put credit union dollars back into credit unions."
America's Credit Unions also highlighted the importance of stakeholder engagement in this process, advocating for public feedback to ensure that any adjustments to the NOL are well-informed and reflective of the industry's needs.
This appeal comes amid broader discussions within the credit union community about regulatory efficiency and the optimal allocation of resources to serve members effectively. The organization expressed hope that under Chairman Hauptman's leadership, the NCUA would prioritize this review to enhance the operational environment for credit unions nationwide.
As of now, the NCUA has not publicly responded to the letter. Credit unions and industry stakeholders await the agency's decision on whether it will undertake a comprehensive review of the NOL and its methodology in the near future.
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Michael Ogden
Editor-in-Chief at CU Times. To connect, email at [email protected]. As Editor-in-Chief of CU Times since 2016, Michael Ogden has led the editorial team in all aspects of content strategy and execution, including the creation of the publication’s exclusive and proprietary research database of the credit union industry’s economic landscape. Under Michael’s leadership, CU Times has successfully shifted to an all-digital editorial product with new focuses on the payments, fraud, lending and regulatory beats. Most recently, he introduced a data-focused editorial product for subscribers that breaks down credit union issues into hard data, allowing for a deeper and more factual narrative for readers. In 2024, he launched the "Shared Accounts With CU Times" podcast, which offers a fresh, inside-the-newsroom perspective through interviews with leaders from the credit union industry and the regulatory world. He dives into pressing credit union issues, while revealing the personalities working behind-the-scenes to push the credit union world forward. His background includes years as a radio and TV anchor/reporter and a public relations and digital/social media manager, where he covered the food and music industries, as well as cooperatives and credit unions. Over the years, he has launched numerous exclusive video and podcast series, including a successful series of interactive backstage interviews with musicians at music festivals, showcasing his social media and live streaming production skills.
