ALEXANDRIA, Va.-NCUA last week set the 2013 corporate CU assessment at eight basis points, or $700.9 million, a sign that the multi-year resolution program may be winding down.
The new assessment comes as some analysts are suggesting NCUA is over-estimating the final tab for the failed corporate credit unions (see related story on page 26).
This year's assessment, the lowest of the four annual charges set by NCUA, brings to $4.8 billion the amount NCUA has collected from credit unions over the past four years to fund the cost of the failed corporates. It also bring almost $11 billion to the cost of corporate failures so far, including $5.6 billion of credit unions' capital erased before NCUA took over and liquidated the five failed corporates: U.S. Central FCU, WesCorp FCU, Members United Corporate FCU, Southwest Corporate FCU and Constitution Corporate FCU.
Last year's assessment was 9.5 BPs or $790 million. NCUA said it will use $650 million of the assessment to repay borrowings from the U.S. Treasury.
Credit unions must account for the payment in their third quarter financials. Payment is due in October.
Pay Raises For Staff
The NCUA Board also approved a one-time, lump-sum payment equivalent of 3% to all employees' salaries as part of its program to initiate pay parity with other federal financial regulators. The cost of the payments will be $3.6 million. The lump sum payments come as NCUA has frozen employee pay for two years while Congress continues to bar pay raises for all federal employees.
The Federal CU Act requires NCUA to maintain comparable pay for its employees compared to federal bank regulatory agencies in order to retain NCUA's ability to hire and keep top talent.
NCUA has set aside almost $14 million to pay for proposed 5% employee pay raises and related benefits this year, but only if Congress approves pay raises for all government employees, which it has refused to do.
NCUA says the now two-year pay freeze for rank-and-file employees, and three-year freeze on executive pay, has increased the gap between NCUA compensation and that at other financial regulators, such as the FDIC and the Federal Reserve and Comptroller of the Currency, where increased pay has ranged from 3.6% to more than 8% since 2011. During that time, NCUA pay has actually declined, according to the agency.
Some staff will also receive payments for so-called locality adjustments for higher cost of living at some localities. The total cost of the locality adjustments is $100,000.
