Do Capital-To-Asset Ratios Affect Credit Union Interest Rates‪?‬

INTRODUCTION How much capital should credit unions have is still somewhat controversial in the credit union industry. For the National Credit Union Administration (NCUA), a well capitalized credit union will have at least a 7 percent net worth ratio (NCUA Rules and Regulations, 2003). Since net worth takes into account expected future charge-offs, this would translate into roughly a net capital-to-asset ratio of around 7.3 to 7.5 percent.