WASHINGTON - The National Credit Union Administration plans to limit the investment powers and toughen the capital standards of the industry's liquidity centers.

A proposal issued for comment last week would require corporate credit unions to move toward a "matched book" portfolio, in which investments are funded with deposits of similar maturity.

NCUA Chairman Norman E. D'Amours promised the House and Senate banking committees during hearings in February and March that the agency would clamp down on corporates. Those hearings were sparked by the failure of Capital Corporate Federal Credit Union.

The board issued the proposals at its April 13 open meeting by a 2-1 vote, with director Robert Swan opposing.

Mr. Swan said he voted against issuing the proposal because he believed the 60-day comment period should be extended. But his remarks at the board meeting indicate he has deeper qualms about tightening the screws on corporates.

"We are regulating to alter a financial system that's operated successfully and profitably for 20 years," Mr. Swan said. "I don't see a need to rush."

NCUA Vice Chairman Shirlee Bowne also said the comment period should be lengthened, but she voted with Mr. D'Amours to leave it at 60 days.

"Some people don't like new things but I think that it's virtually unanimous that changes need to be made," Mr. D'Amours said.

The proposed rule would for the first time dictate asset-liability management limits to corporates.

Under the proposed rule, 75% of a corporate's overnight deposits would have to be matched with assets of similar terms. Up to 25% of a corporate's overnight deposits could be matched against variable-rate securities with maturities of up to three years, provided certain conditions are met.

One area in which investment powers would be loosened from current agency policy is foreign investments. The NCUA banned corporates from putting deposits in foreign banks in February 1994, after disclosures that U.S. Central Credit Union had money in a troubled Spanish bank.

The new rules would allow money to be invested abroad, but the minimum standards for institutions receiving the funds are being toughened.

Under the agency's criteria outlined in the proposal, only nine international banks currently qualify to accept corporate funds. Corporates' foreign investments also would be limited as a percent of capital rather than assets.

On the capital side, the regulation would require a minimum capital ratio of 4% for corporates by Jan. 1, 1998. Up to 50% of this primary capital could consist of contributions from credit unions that would be redeemable only with NCUA approval.

The proposal also would allow optional secondary capital consisting of contributions from member credit unions, and require a two-year notice before withdrawal.

Debt obligations, asset-backed securities, and privately issued collateralized mortgage obligations would be limited to 25% of primary capital. CMOs also would be subject to more restrictive stress tests and price-sensitivity requirements.

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