WOCCU Meets With International Regulatory Committees

On October 7, the World Council of Credit Unions, Inc. (WOCCU) met with four separate regulatory committees in Basel, Switzerland, the site of the Bank for International Settlements (BIS) headquarters, to discuss the role credit unions play in international finances and the financial services regulatory environment. Three of the four committees, the Committee on Payments and Settlement Services (CPSS), the Financial Stability Institute (FSI) and the Basel Committee on Banking Supervision (BCBS), are part of the (BIS), which acts as an international central bank, setting regulatory laws that affect both banks and credit unions on a global level.

Topics covered in these meetings included clearing and settlement systems, and ensuring they are accessible to credit unions; the work of the World Bank remittance task force, of which WOCCU is a part; upgrading the skills of credit union regulators; issues surrounding the new Basel II Capital Accord, a recent revision on capital requirements for financial institutions; and the BCBS' upcoming review of the Core Principles Methodology for banking supervision.

CPSS, which coordinates the central bank payment system for G-7 countries (a group of seven leading industrial nations that began meeting annually in the mid-1970s to address economic and political issues that they and the rest of the world face), was most interested in discussing systemically important large-value payment systems, as it has not yet focused on issues related to retail payment systems. During the meeting, use of CPSS's report on "Core Principles for Systemically Important Payment Systems" was granted to credit unions and WOCCU to employ in justifying CU's access to clearing and settlement systems.

The meeting with the FSI, the training arm of the BSI for financial institutions regulators globally, concluded with a similarly positive outcome. WOCCU will be working with FSI to review their programs and potentially jointly develop programs to ensure appropriate regulation of credit unions. WOCCU to develop and implement a prudentially sound of regulation manner that is unique to credit unions.

With the BCBS, Dave Grace, WOCCU's senior manager of association services discussed the provision of guidance for credit union regulators regarding the issue of how and if the new Basel II Capital Accord should apply to credit unions. They also spoke about a potential meeting between credit union regulators and the BCBS on recent regulatory developments, as well as the BCBS's review of the Core Principles Methodology for banking supervision. The BCBS shares WOCCU's standpoint that the Basel II should be applied differently according to national circumstances, representatives felt that CU regulators should meet on their own to discuss the current regulatory environment rather than BCBS imposing its own structure. BCBS also reported that the Core Principles review has begun and they were very interested in understanding how these should be adopted for credit union regulators.

"We consistently hear our members worldwide expressing the need for appropriate regulation and supervision. By working with the global authority or financial sector supervision we are significantly advancing the needs of our members and consumers," explained Grace.

Finally, the meeting with the Financial Stability Forum (FSF), an independent global coordinating body that monitors financial system vulnerabilities, focused on the role that credit unions play in financial stabilization, namely leveling income inequality. WOCCU proposed that the Forum adopt its International Principles for Credit Union Safety and Soundness, and although no conclusive agreement was made, the representatives encouraged the presentation of the proposal to the committee as a whole, which WOCCU may do at their next meeting.

El Consejo Mundial de Cooperativas de Ahorro y Crédito es la asociación gremial y agencia de desarrollo para el sistema internacional de cooperativas de ahorro y crédito. El Consejo Mundial promueve el crecimiento sustentable de las cooperativas de ahorro y crédito y otras cooperativas financieras en todo el mundo a fin de facultar a las personas para que mejoren su calidad de vida a través del acceso a servicios financieros asequibles y de alta calidad. El Consejo Mundial realiza esfuerzos de defensa activa en representación del sistema global de las cooperativas de ahorro y crédito ante organizaciones internacionales y trabaja con gobiernos nacionales para mejorar la legislación y la regulación. Sus programas de asistencia técnica introducen nuevas herramientas y tecnologías para fortalecer el desempeño financiero de las cooperativas de ahorro y crédito y profundizar su alcance comunitario.

El Consejo Mundial ha implementado 290 programas de asistencia técnica en 71 países. A nivel mundial, 51,000 cooperativas de ahorro y crédito en 100 países atienden a 196 millones de personas. Obtenga más información sobre el impacto global del Consejo Mundial en www.woccu.org.