---
kind: "section"
citation: "12 C.F.R. § 702.101"
title: "12"
number: "702.101"
heading: "Capital measures, capital adequacy, effective date of classification, and notice to NCUA."
url: "https://uscodex.org/cfr/12/702.101"
---

# §702.101. Capital measures, capital adequacy, effective date of classification, and notice to NCUA.

- (a) **Capital measures.** For purposes of this part, a credit union must determine its capital classification at the end of each calendar quarter using the following measures:
  - (1) The net worth ratio; and
  - (2) If determined to be applicable under [§ 702.103](/cfr/12/702.103.md), either the risk-based capital ratio under [§ 702.104(a) through (c)](/cfr/12/702.104.md?p=a..c) or the CCULR framework under [§ 702.104(d)](/cfr/12/702.104.md?p=d).
- (b) **Capital adequacy.**
  - (1) Notwithstanding the minimum requirements in this part, a credit union defined as complex must maintain capital commensurate with the level and nature of all risks to which the institution is exposed.
  - (2) A credit union defined as complex must have a process for assessing its overall capital adequacy in relation to its risk profile and a comprehensive written strategy for maintaining an appropriate level of capital.
- (c) **Effective date of capital classification.** For purposes of this part, the effective date of a federally insured credit union's capital classification shall be the most recent to occur of:
  - (1) **Quarter-end effective date.** The last day of the calendar month following the end of the calendar quarter;
  - (2) **Corrected capital classification.** The date the credit union received subsequent written notice from NCUA or, if state-chartered, from the appropriate state official, of a decline in capital classification due to correction of an error or misstatement in the credit union's most recent Call Report; or
  - (3) **Reclassification to lower category.** The date the credit union received written notice from NCUA or, if state-chartered, the appropriate state official, of reclassification on safety and soundness grounds as provided under [§ 702.102(b)](/cfr/12/702.102.md?p=b) or [§ 702](/cfr/12/702.md). 202(d).
- (d) **Notice to NCUA by filing Call Report.**
  - (1) Other than by filing a Call Report, a federally insured credit union need not notify the NCUA Board of a change in its capital measures that places the credit union in a lower capital category;
  - (2) Failure to timely file a Call Report as required under this section in no way alters the effective date of a change in capital classification under [paragraph (b)](#b) of this section, or the affected credit union's corresponding legal obligations under this part.

## Notes

### Amendments

[80 FR 66706, Oct. 29, 2015, as amended at 86 FR 72804, Dec. 23, 2021]

### Source

Source: 80 FR 66706, Oct. 29, 2015, unless otherwise noted.

### Authority

Authority: 12 U.S.C. 1757(9), 1766(a), 1784(a), 1786(e), 1790d.

### Source

Source: 65 FR 8584, Feb. 18, 2000, unless otherwise noted.

### Amendments

[80 FR 66706, Oct. 29, 2015, as amended at 86 FR 72804, Dec. 23, 2021]