Tuesday, December 14, 2010 10:20:56 AM
WASHINGTON - In light of the significant "belt tightening" of many credit unions and the Obama Administration's proposal to freeze civilian federal workers' salaries for two years, CUNA continues to urge NCUA to take similar action.
In a letter to NCUA Chairman Debbie Matz, CUNA President/CEO Bill Cheney underscored that that although credit unions are generally well capitalized, and this year net income at credit unions has recovered somewhat, credit unions are still struggling to remain afloat, "especially considering the need for many credit unions to rebuild capital."
Cheney continued, "We understand members of your staff are seeking more information about the [administration's salary-freeze] proposal to determine its implications for the NCUA, which as an independent federal agency may not be covered by the proposal."
Regardless of the staff's determination, Cheney urged NCUA to implement a salary freeze to the fullest extent possible.
At its November open board meeting, the agency approved a $25 million increase for its 2011 budget, 12% over its 2010 funding plan. The total budget for 2011 will be just over $225 million, and part of that would go to fund pay increases that could, in extreme cases, range as high as 6% to 8%.
In its letter to the NCUA chairman, CUNA noted the support CUNA, credit unions and the leagues have always shown for "a strong independent agency, which has access to sufficient resources in order to ensure safety and soundness objectives under the Federal Credit Union Act are adequately met..." That support is unwavering, CUNA said, despite the unique situation that the greatest part of those resources come directly from credit unions.
"In light of the belt tightening at credit unions and the new proposal from the administration, we believe it is appropriate and reasonable for NCUA to do all it can to contain its own costs," Cheney wrote.
CUNA's letter to the Chairman is available here.