Current through Register Vol. 63, No. 9, September 1, 2024
(1) Procedures. Balances sheet assets and
credit equivalent amounts for off-balance sheet items are assigned to a
risk-weight category. The total dollar amount in each category shall be
multiplied by the risk-weight assigned to that category. The sum of the
categories comprises risk-weighted assets.
(2) Frequency. The corporate central credit
union shall calculate the ratio of capital to risk-weighted assets each month.
A record of such calculation shall maintained.
(3) Risk Weights for Balance Sheet Assets.
Each balance sheet asset shall be assigned a risk weight of 0 percent, 20
percent, 50 percent, and 100 percent as set forth in OAR
441-720-0120.
(4) Other Considerations:
(a) An investment in the shares of a mutual
fund is assigned to the risk category appropriate to the highest risk-weighted
asset that the fund is permitted to hold. In addition, if the fund engages in
the use of forwards, options, futures, or similar activities other than when
used to reduce interest rate risk, then investments in the fund will be
assigned to the 100 percent risk category; and
(b) Accruals will be assigned the
risk-weighting of the underlying asset that they represent.
(5) Credit Conversion Factors for
Off-Balance Sheet Items. Off-balance sheet items will be risk-weighted each
month using the following credit conversion factors:
(a) Zero Percent Credit Conversion Factor.
Unused portions of credit lines with original maturities of six months or less,
or which are unconditionally cancelable;
(b) 50 Percent Credit Conversion factor:
(A) Unused portions of credit lines with
original maturities exceeding six months; and
(B) Commitments to participate in a loan or
loan package;
(c) 100
Percent Credit Conversion Factor:
(A)
Irrevocable standby letters of credit guaranteeing financial performance,
including VISA letters of credit issued by corporate central credit unions on
behalf of their members, or standby letters of credit backing Industrial
Revenue Bonds;
(B) Forward
Commitments to purchase an asset or perform under a lease contract;
and
(C) Securities held in
safekeeping loaned with indemnification.
(d) Those items and credit conversion factors
addressed on a case-by-case basis by the Director.
(6) Risk-based Capital Ratios:
(a) The primary capital ratio is computed by
dividing primary capital by total risk-weighted assets;
(b) The total capital ratio is computed by
dividing risk-based capital by total risk-weighted assets; and
(c) Month-end amounts will be used to
calculate corporate central credit union capital ratios.
Stat. Auth.: ORS
723.102, ORS
723.156 & ORS
723.730
Stats. Implemented: ORS
723.730
