America's 85.3 Million Credit Union Members to Benefit From Proposed Legislation.

SAN DIMAS, Calif. -- Congressman Ed Royce (CA-40th), a member of the House Financial Services Committee, told a gathering of more than 120 credit union leaders and CEOs today that he is currently working with Congressman Paul Kanjorski on modifications to the Credit Union Regulatory Improvements Act of 2003 (CURIA), and plans to re-introduce that legislation in the House this session. "I am confident that we will soon, and I mean very soon, unveil legislation that will increase the safety and soundness of the system, and improve the ability for credit unions to manage their balance sheets and serve customers," Royce said.

The legislation is designed to provide regulatory relief for credit unions, such as raising the cap on member business lending to 20 percent of assets and allowing NCUA to devise a new risk-based capital standard.

An active supporter of credit unions since his state senate days in the early 1980s, Congressman Royce was featured with JoAnn Johnson, chairman of the National Credit Union Administration, at a first-ever Credit Union Summit convened to discuss regulatory capital and legislation influencing America's 9,311 credit unions. Royce and Johnson participated in the open forum along with David Chatfield, President of the California Credit Union League, Bob Siravo, President/CEO of WesCorp and credit union leaders representing more than 4 million credit union members throughout California's Southland with assets of approximately $42.6 billion.

"I believe that the modernization of capital regulation was the most significant component of this legislation," Royce said. He explained that on the international scene, the regulatory trend is toward risk-based capital standards. Bank regulators have subscribed to this model since the original Basel Accord in 1988. "It seems appropriate to me that a financial institution does not need to hold as much capital against a fully secured mortgage loan as an unsecured personal loan," he said. "I have seen risk-based capital improve oversight of banks, thrifts and government sponsored enterprises. It makes a whole lot of sense to give credit unions the same opportunity to live under a smarter and a better regulatory regime."

In her remarks, Chairman JoAnn Johnson announced that the NCUA is releasing its January 2005 draft report entitled Prompt Corrective Action Proposal for Reform. The report discusses recommended statutory changes and provides details as to how NCUA would design a new risk-based system for federally insured credit unions. (See www.ncua.gov/ReportsAndPlans/special/special.html)

"My goal is for credit unions to be able to better serve their constituents, their members," Johnson said. "And how can we do that? I believe we do it by reducing burdensome regulation." She went on to point out the benefits associated with the CURIA bill, saying that banks were allowed to modernize under the Graham-Leach-Blyly, and now it's time that credit unions are also allowed to modernize.

Johnson explained her belief that the Prompt Corrective Action Proposal for Reform would fit nicely with Congressman Royce's desire to establish a risk-weighting system for capital for credit unions. "It will be comparable to FDI insured institutions. It tailors the risk asset categories and weights of the Basel II as well as related aspects of the FDIC/PCA system to the operations of the credit union. A risk-weighted PCA system would better achieve the objectives of PCA. And, it's consistent with sound risk management principles."

In Southern California alone, more than 4 million people take advantage of the services credit unions provide. There are 281 credit unions located in Los Angeles, Orange, San Bernardino, and Riverside counties combined, representing approximately $42.6 billion in assets. Among these credit unions, three are ranked among the top 10 in assets in the country (5th-Orange County Teachers Credit Union in Santa Ana, 15th-Wescom Credit Union in Pasadena, and 16th-Kinecta in Manhattan Beach).

Los Angeles      Orange      San Bernardino  Riverside
                  County         County         County        County
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Credit
 Unions              219             31             21             10
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Members        3,008,317        656,697        249,560        164,161
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Combined
 Assets  $31,279,150,315 $8,519,839,433 $1,653,034,691 $1,210,762,722
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(Data courtesy of the California Credit Union League)

The 2005 Credit Union Summit took place at WesCorp, a corporate federal credit union headquartered in San Dimas, California. WesCorp, together with the California Credit Union League, hosted today's event.

About WesCorp

Established in 1969, WesCorp is Western Corporate Federal Credit Union -- America's largest corporate credit union. As a financial-services cooperative with approximately $24 billion in assets and more than 1,000 member/owner credit unions located throughout the United States and Guam, WesCorp operates under authorities granted by The National Credit Union Administration. WesCorp serves its credit union membership through an array of investment, credit, payment, funds-transfer, and settlement solutions supported by a variety of educational conferences, publications and webcasts. Headquartered in San Dimas, California, WesCorp also provides member service through offices in Boise, Idaho; Honolulu, Hawaii; Salt Lake City, Utah; San Leandro, California; and Seattle and Spokane, Washington. Visit www.wescorp.org for more information.