WASHINGTON – The Senate last night passed a bill directing the Government Accountability Office to conduct a comprehensive study of NCUA’s handling of the corporate credit union meltdown, as well as the agency’s handling of the growing losses among big credit union failures.
The bill requires the congressional accounting arm to determine the reasons for all corporate failures since 2008 and the adequacy of NCUA’s response, as well as the ability of insured credit unions to pay for the projected $16 billion cost of the bailout and whether the program exposes taxpayers to any potential liability.
The bill also directs the GAO to study whether NCUA has properly implemented recommendations made by its Office of Inspector General the past two years on reviews of ten big credit union failures.
The study will be sent to the Senate Banking Committee, the House Financial Services Committee and the Financial Stability Oversight Council.
Passage of the Senate bill comes a week after the Senate Banking Committee held hearings on the corporate bailout featuring NCUA Chairman Debbie Matz.
The bill also includes several technical corrections sought by NCUA, including a provision that will allow credit unions acquiring troubled credit unions to count emergency Section 208 assistance from NCUA in their net worth after the merger; and will allow it to pay out funds from the corporate bailout fund without borrowing from the U.S. Treasury.
