WASHINGTON-State regulators are scrambling to learn more about NCUA's proposed Corporate Stabilization Plan to determine how it will impact the state-chartered CUs they regulate - and how the regulators will take that impact into consideration come examination time.
"NASCUS is studying the NCUA action and analyzing what its impact will be," said Mary Martha Fortney of the National Association of State Credit Union Supervisors. "Going forward, there is a great need for transparency in this process."
At press time, NASCUS was gearing up for a regulator-to-regulator conference call that would link up state regulators with the federal regulator to discuss the issue.
"I expect Board Member Gigi Hyland [the NCUA liaison to the state regulators] is going to say that we need to look at this [proposed rule] and say what we think of it."
Following that call, NASCUS will hold its regular quarterly teleconference Monday, which will be the first opportunity the trade group will have to get all of its associated state regulators on the phone to discuss the proposal, Fortney said.
"In the role as supervisors of state charters, our state regulators are trying to determine how this will affect the credit unions they regulate," Fortney said. "As we have on other issue in the past, we will work with NCUA to create examination guidelines for this."
The other piece of the puzzle, she said, is the accounting aspect. "When will the write-down occur, when do they expense this," she asked, noting that a bill moving through Congress could grant the authority for a five-year write-off of these losses, similar to what FDIC already has - a move that would help lighten the burden of the bailout.
Still, tension is mounting as credit union land waits to see the December numbers come out, Fortney observed. "Those figures will be coming out soon. It's no secret that the fourth quarter wasn't pretty."
