House approves bill that includes provision to delay RBC rule
The U.S. House of Representatives on Tuesday passed a bill that includes a provision to delay implementation of the National Credit Union Administration’s risk-based capital rule by two years – much to the delight of the two major credit union trade associations.
Both trades argue the RBC rule, as currently written, would result in increased regulatory burdens and costs for credit unions.
After the House voted to approve the Foreign Investment Risk Review Modernization Act of 2018 (H.R. 5841), both the National Association of Federally-Insured Credit Unions and the Credit Union National Association issued statements praising lawmakers Tuesday afternoon.
“NAFCU thanks Representatives Robert Pittenger, Bill Posey, Denny Heck and Chairman Jeb Hensarling for their bipartisan efforts on this RBC-delay provision and for all House members that voted in support of the measure,” Dan Berger, NAFCU’s president and CEO, said in a statement. “We have sought relief from this rule since it was finalized, and we are pleased to see this provision gaining traction as lawmakers recognize the negative impact this rule would have on the credit union industry.”
Jim Nussle, president and CEO of CUNA, said, “CUNA and credit unions have well-founded concerns about NCUA’s risk-based capital rule, primarily whether or not NCUA even has the legal authority to issue such a rule. We continue to maintain the risk-based capital rule is a solution in search of a problem, and support Congressional efforts to delay the rule.”
The Foreign Investment Risk Review Modernization Act of 2018 passed by a margin of 400-2. Earlier this week, NAFCU sent a letter to House leaders in support of the bill, which includes a provision delaying the effective date of the RBC rule to Jan. 1, 2021 from Jan. 1, 2019.
Also on Tuesday, CUNA wrote to the Senate Banking Committee urging the committee’s leadership to consider drafting legislation that would delay the risk-based capital rule.
More of Credit Union Journal's RBC coverage can be found here.