RALEIGH, N.C. — State Employees' Credit Union on Tuesday got a jump on the capital plans and stress tests scheduled to be required of larger credit unions starting early next year by announcing it has "proactively adopted a new capital plan commensurate with recently published NCUA guidelines."
The $28 billion credit union said it contracted with Promontory Financial Group in Washington, D.C., to assist in the development of the new capital plan. Promontory is a strategy, risk management and regulatory compliance consulting firm led by Eugene Ludwig, former Comptroller of the Currency.
SECU said it worked with Promontory to "ensure" the capital plan will meet NCUA's guidelines. Three mandatory elements included in the plan are:
1. A strategic discussion of the credit union's business, including a business overview, summary of recent financial performance, relevant aspects of business strategy, and a description of risk profile and risk management overview.
2. Capital planning process, highlighting capital policy and capital planning practices, governance, internal control framework, and short-term and long-term plans for improvement.
3. Capital planning forecast and consolidated results, especially overview of economic scenarios, detailed financial results under baseline and stress conditions, and key assumptions and sensitivities.
"Having an adequate capital plan that meets our insurance examiner's requirements is paramount as our credit union prepares for impending stress tests in the coming year," said SECU Chief Financial Officer Mike Lord in a statement. "We are pleased that Promontory worked with us on this project, and look forward to NCUA's concurrence of the plan's adequacy."