In remarks before NCUA's Capital Summit last week, the National Association of State Chartered Credit Unions (NASCUS) reiterated its support for alternative capital (see related story, page 18).
Testifying on behalf of NASCUS, Fran?ois Henriquez, general counsel for Lenexa, Kan.-based U.S. Central, restated that NASCUS fully supports the establishment of a risk-based net worth ratio requirement for natural-person CUs that would work in tandem with a revised leverage ratio.
Henriquez told the agency that, "We all agree that capital is beneficial to credit unions, their members, and their regulators. However, when it comes to alternative capital, the credit union movement seems to be asking, 'Why should we add alternative capital?' Given credit unions' desire to have the flexibility to serve their members better, and credit union regulators' desire to assure capital adequacy, NASCUS believes the question today should be, 'Why shouldn't we add alternative capital?'
Henriquez said NASCUS disagrees with a recent GAO assessment that alternative capital threatens the member-owned cooperative nature of credit unions, saying the corporate model of "paid-in capital" is a demonstration of how viable the concept is. For the complete testimony, visit www. nascus.org.
