WASHINGTON – NCUA, fresh off last week’s assessment to replenish reserves for the National CU Share Insurance Fund, will give credit unions new estimates for next year’s charges for both the insurance fund and the corporate credit union bailout in the next few weeks.
The estimates for next year are expected to be provided at the NCUA Board’s November meeting, Gigi Hyland, a member of the three-member panel, said yesterday during remarks at NAFCU’s annual Congressional Caucus.
NCUA assessed federally insured credit unions a total of 15 basis points, or $1.1 billion, last year for the NCUSIF and corporate charges; and 26 bps, or slightly more than $2 billion, for this year’s charges. The charges are expected to continue into the future.
Hyland acknowledged the burden that the premium and assessment place on credit unions but underscored the necessity for the charges to maintain the safety of the insurance fund and the corporate system. She also noted that the total for the premium and assessment came in within the lower range anticipated by Board last November, which was 25 bps to as much as 40 bps.
“The decision to charge the premium was not taken lightly,” said Hyland. “However, in these turbulent economic times where we anticipate continued losses at credit unions, it is not practical to manage the fund without a reasonable margin of safety.”
“The responsible public policy is to manage the fund cautiously,” she said. “Last Thursday, the NCUA Board restored a reasonable margin of safety for the present, rather than risking a loss of confidence in the future.”
