“We want to make sure our clients are informed about the impact of the new risk-based capital rule in order to understand where their credit union stands and how it will affect them in the future.”
Washington, DC (PRWEB) January 29, 2014
Coinciding with the National Credit Union Administration’s announcement of proposed changes to the Prompt Corrective Action rule, Callahan & Associates has added new risk-based capital calculations in Peer-to-Peer Cloud Edition. These additions allow credit unions to easily track their risk-based capital levels historically, providing insight into how the proposed rules affect their institution.
Callahan & Associates has added three charts for credit unions to use while monitoring their risk-based capital:
- Risk-Based Capital Ratio: Puts a credit union’s current performance in a historical context with a trend chart which can credit unions can use to compare themselves versus local and national peers.
- Risk-Based Capital Ratio versus Net Worth Ratio: Plots both a credit union’s Risk-Based Capital Ratio and Net Worth Ratio on one graph to see how the two metrics compare. Under new guidelines, credit unions greater than $50 million in assets must maintain a 7% Net Worth Ratio and a 10.5% Risk-Based Capital Ratio.
- Risk-Weighted Assets Breakdown: Breaks down the different components that go into risk-weighted assets to evaluate their individual impact on the overall Risk-Based Capital Ratio.
“These changes are part of the ongoing evolution of Peer-to-Peer based on the needs of credit unions,” said Alix Patterson, Chief Operating Officer at Callahan & Associates. “We want to make sure our clients are informed about the impact of the new risk-based capital rule in order to understand where their credit union stands and how it will affect them in the future.”
Peer-to-Peer Cloud Edition is Callahan & Associates’ most in-depth financial analysis and benchmarking resource. Using 18 years of credit union data and eight years of bank data, Peer helps credit unions accurately and quickly compare their performance against relevant peers, including FDIC-regulated banks.
Callahan & Associates is a Washington, DC-based firm that delivers in-depth analysis of credit union quarterly performance through its proprietary software and financial publications. As a financial consultant, it also offers strategic planning and investment management for credit unions. Visit http://www.callahan.com to learn more.