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Association Supports Closure of Stabilization Fund

Wed, Sep 6, 2017

On September 5, the Association submitted a comment letter on the NCUA’s proposal to close the Temporary Corporate Credit Union Stabilization Fund which aims to:

  • Close the Stabilization Fund this year
  • Transfer assets to the Share Insurance Fund Oct. 1
  • Raise the Share Insurance Fund’s normal operating level from 1.3 percent to 1.39 percent
  • Refund between $600 million and $800 million to credit unions in 2018 (most likely Q2)

Based on feedback from a member survey, Association president/CEO, John Bratsakis urged the NCUA to “…make every effort to maximize the timely distribution of TCCUSF equity… The remaining excess balances should be disbursed as soon as possible to the benefit of the 108 million consumers served by credit unions, and not remain on the books of our federal insurance fund following the conclusion of the proposed merger.”

Bratsakis urged the NCUA to reconsider its plan to raise the Share Insurance Fund normal operating level from 1.3 percent to 1.39 percent, and consider, “…the real-world impact of the higher operating level, and instead opt to continue premium assessment practices when necessary.”

The NCUA is also proposing a rule to amend the method for determining an insured credit union’s proportionate share of an NCUSIF equity distribution, and a temporary provision governing equity distributions related to the Corporate System Resolution Program.