Statement of Chairman Fryzel Regarding Today’s Financial Stability Plan Announcement By U.S. Treasury Secretary Geithner
February 10, 2009, Alexandria, VA –– “Today marks a new day in the process of the federal government’s broad response to the financial crisis. Updated initiatives announced by Treasury Secretary Geithner under the terms of the Financial Stability Plan will hopefully provide credit unions with access to workable and useful tools to deploy in mitigating the market instability. Over the coming days I intend to restate my earlier requests to the Secretary to make funds available to credit unions through an asset purchase program called for in statute, and to ensure that rules are written to give credit unions the ability to take advantage of any new-created aspects of the federal response.
The Secretary’s announcement of a comprehensive stress test for major banking institutions is also significant. NCUA undertook a similar stress test of the National Credit Union Share Insurance Fund in late 2008 as part of its overall efforts to better prepare for all contingencies associated with the continuing market distress, and considers this approach critical given the volatile and uncertain nature of the economic landscape.
Finally, I commend Secretary Geithner for his focus on the importance of banks to increase lending. Credit unions have continued to exhibit strong loan growth, but I realize that all sectors of the financial services industry must do their part for the American consumer if the Nation is to regain strong financial footing.
NCUA is anxious to do its part to contribute to the economic recovery, and understands that a wide variety of responses by both the federal government and private sector is essential to ultimate success.”
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