c. myblog

July 22, 2016

Be Clear on Your Objective of Doing a Core Deposit Study

Earlier this week we presented at a virtual roundtable with 100+ CFOs, and one of the most common questions centered around the benefits, or lack thereof, of doing core deposit studies for use in net economic value (NEV). It is important to study member behavior with respect to deposits, including migration, pricing strategy, and competitive […]

April 14, 2016

Regulator Risk: NCUA Consolidation?

Recently the U.S. Government Accountability Office (GAO) submitted a recommendation to Congress for all depository institutions to be combined under one regulatory entity. Congress could consider consolidating the number of federal agencies involved in overseeing the safety and soundness of depository institutions…” —GAO, March 2016 We want your feedback! If federal agencies (including NCUA) were consolidated, […]

April 21, 2015

Draft Response to RBC 2.0

As promised in last week’s blog post, our draft response to RBC 2.0 can be found here. Our main objective in writing this response is to convince NCUA that it would be dangerous for the industry, regardless of the chosen methodology, to add an interest rate risk (IRR) component to the proposed rule. IRR is […]

April 17, 2015

Risk-Based Capital Rule 2.0

Even though the Risk-Based Capital Rule 2.0 (RBC 2.0) has been watered-down, it is not good for the industry. Don’t forget a key component of the RBC 2.0 is NCUA’s consideration of adding a separate interest rate risk (IRR) component to risk-based capital. Standardizing IRR, assumptions, and/or approaches to assumptions, guarantees that the unique risk […]

March 13, 2015

Voice your concerns NOW about NCUA’s consideration of adding a separate IRR component to RBC

If RBC 2.0 passes as written, each credit union defined as complex will be required to quantify their unique risks and maintain adequate capital to back those risks, all of which is to be supported by a written strategy. Excerpt from proposed RBC 2.0, §702.101 (b) Capital Adequacy: “(1) Notwithstanding the minimum requirements in this […]

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