WASHINGTON — The American Bankers Association is urging the National Credit Union Administration not to finalize its proposed application process for permitted payment stablecoin issuers until the agency also proposes the broader prudential standards that would govern capital, liquidity, risk management and supervision, according to an ABA comment letter dated April 13.
In the five-page letter, ABA said the NCUA proposal is too incomplete to move forward on its own because it focuses largely on how applications would be handled while leaving key operating standards to a later rulemaking. ABA said that sequencing could create confusion under the GENIUS Act’s framework for payment stablecoins and argued that stakeholders should be able to evaluate the full regulatory regime “holistically” before the agency finalizes the application rule.
ABA said NCUA’s proposal resembles an earlier rule issued by the Federal Deposit Insurance Corp. that, in ABA’s view, did not initially include the substantive prudential requirements required by the GENIUS Act. In its NCUA letter, ABA noted that the FDIC published a separate proposed rule on April 10 addressing those areas, including capital, liquidity and risk-management requirements.
Other Reasons to Wait
According to ABA, the credit union regulator should wait until it has issued its own companion proposal on issuer standards and until related federal rulemakings are available for review. ABA said the statute contemplates coordinated rulemaking among the primary federal payment stablecoin regulators and argued that NCUA should work closely with the FDIC, Federal Reserve and Office of the Comptroller of the Currency so that requirements and supervisory expectations are equivalent across agencies. ABA said that approach would help preserve financial stability and avoid conferring competitive advantages that could predetermine “winners and losers” in the emerging stablecoin market.
As the CU Daily reported earlier, NCUA announced its proposed rule on Feb. 11, and the proposal was published in the Federal Register on Feb. 12. The rule would establish the process for federally insured credit unions and their subsidiaries to seek NCUA approval to issue payment stablecoins, including application standards, evaluation procedures and appeal rights for denials. The comment period closed April 13.
What NCUA Has Previously Said
In prior public statements, NCUA has said it is separately coordinating with the other primary federal payment stablecoin regulators on additional proposed rules covering issuer
