Credit Unions Get Capital Relief to Ease Loan Accounting Revamp

June 24, 2021, 9:43 PM

Credit unions can blunt the effect of shoring up the capital they hold when they transform their accounting for bad loans in 2023, the credit union regulator announced Thursday.

The National Credit Union Administration finalized a rule allowing institutions to phase in over three years the change to the capital they hold when they adopt the current expected credit loss (CECL) accounting standard.

Implementing the new accounting “should not prevent credit unions from serving their members and communities because they cannot manage their capital levels appropriately. That is why this rule before us today is so important,” NCUA Chair ...

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