Jepsen Rejects GAO's Criticism

The National Credit Union Administration has taken exception to two items in a state-of-the-industry report prepared by the General Accounting Office.

Mr. Jepsen, the NCUA chairman, wrote a letter finding fault with the congressional agency's comment that "neither the industry nor the fund have been under pressure in recent years."

In its comment, the GAO said that the fund, though generally sound, had not been severely tested.

But Mr. Jepsen said the soundness of the agency and the fund have been shown by the "Troubled times," namely a 20% decline in the number of credit unions in the last five years, the failure of a large private insurer, and substantial losses to the national fund from commercial real estate lending in New England and the Southwest.

The regulator also rejected the GAO's recommendation that the NCUA be consolidated with other federal regulatory agencies.

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