NCUA Chairman Rodney Hood’s remarks to the Financial Stability Oversight Committee were released late last week, with Hood saying that the agency has “responded decisively to the needs of federally insured credit unions during the pandemic and is fulfilling its critical mission of protecting the safety and soundness of the system.”
Credit unions were “well capitalized” heading into the COVID-19 crisis, and, as of the first quarter, the aggregate net worth ratio for federally insured credit unions was “robust” at 11.01 percent, Hood said.
In late May, the NCUA Board approved temporary changes to the agency’s prompt corrective action regulations to ensure that federally insured credit unions remain operational and liquid so that they could continue to serve their members during the pandemic, Hood told the committee. He also said that, as of the end of June, the Central Liquidity Facility’s borrowing authority stood at over $25 billion (up from $10.5 billion in April), with nearly 4,000 credit unions having access to that funding source.
Further, Hood said that NCUA is looking at ways to improve credit union access to secondary capital, which can enable low-income credit unions to expand lending and other services to underserved communities and can serve as a basis for low-income credit unions to grow and achieve better economies of scale.
Hood’s full statement to the committee can be accessed on the NCUA website.