NAFCU Director of Research/Chief Economist Curt Long estimatedthe NCUA's revised risk-based capital ratio proposal would cost thecredit union system a total of $760 million.

“Based on our financial analysis, credit unions' capitalcushions will suffer a $490 million hit if NCUA promulgates atwo-tier approach to risk-based capital. The specifics are evenmore astronomical,” Long said.

He added, “In order to satisfy the proposal's 'well-capitalized'thresholds, today's credit unions would need to raise an additional$760 million. On the other hand, to satisfy the proposal's'adequately capitalized' thresholds, today's credit unions wouldneed to raise an additional $270 million.”

Long said the proposed rule “misclassifies safe, sound creditunions and imposes the unnecessary burden to raise additionalcapital in order to maintain their current capital buffers or avoidprompt corrective action.”

Despite the changes to the original proposal, NAFCU maintained the proposed rule is unnecessary atthis time.

“Even though this rule looks better on paper than the last one,almost all of the substantive changes to the risk weights were madeto investments,” Long said. “So I think we'll really have to lookat this rule in tandem with the upcoming interest rate risk rulebefore we can know whether it is materially better than the initialrisk-based capital proposal.”

The NCUA has estimated that the total non-recurring costs ofimplementing the proposalthrough 2018 would be $3.7 million.

The approximate total one-time costs for non-complex creditunions totaled 101,980 hours or $3,252,142, amounting to an averageof $638 per credit union.

For complex credit unions, estimated costs totaled 58,200 hoursor $1,855,998, averaging $1,276 per credit union.