NCUA To Focus On PCA, Collecting Data

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NCUA's focus in 2006 will be on reforming prompt corrective action (PCA) and collecting data on credit union service to members.

NCUA Chairman JoAnn Johnson said NCUA will soon unveil a process for collecing the member data. The issue came to the forefront following November hearings before the House Ways and Means Committee on the CU tax exemption at which Johnson and others were asked for evidence to support credit union claims of service to underserved markets. None of the credit union representatives was able to produce any.

Prior to those hearings, NCUA had put in place a working group in 2003, in the wake of a GAO study on the same issue, that was charged with analyzing credit union service to low- to moderate-income populations.

In remarks before the Iowa Credit Union League's annual conferencee, meanwhile, Johnson said the agency will continue to pursue a philosophy of "earned flexibility" for federal credit unions, and noted NCUA had recently lowered the RegFlex qualifying net worth ratio from 9% to 7% for well-managed, well-capitalized credit unions.

Among other points, Johnson said NCUA will:

* Maintain "wise stewardship of agency resources" in the budget and allocation of resources.

* Remain steadfast in enhancing a safe and sound federal credit union charter, share insurance fund, and opportunities for credit unions to mitigate risks.

* Evaluate opportunities to implement a risk-based capital structure for the corporate credit union system.

* Monitor and support the ongoing recovery and health of credit unions affected by last year's hurricanes.

* Continue to press Congress to support regulatory improvements.

* Seek to broaden partnerships for NCUA's Access Across America outreach initiative.

* Continue to support efforts to boost member business lending.

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