{"data":{"id":"us/12-cfr-702.302","jurisdiction":"us","citation":"12 CFR 702.302","heading":"Definitions.","body":"For purposes of this subpart—\nBaseline scenario means a scenario that reflects the consensus views of the economic and financial outlook.\nCapital plan means a written presentation of a covered credit union's capital planning strategies and capital adequacy process that includes the mandatory elements set forth in this subpart.\nCapital planning process means development of a capital policy and formulation of a capital plan that conforms to this part.\nCovered credit union means a federally insured credit union whose assets are $10 billion or more.\n(1) Timing. A credit union that crosses the asset threshold as of March 31 of a given calendar year is subject to the applicable requirements of this subpart in the following calendar year.\n(2) Regulatory relief for 2021 and 2022. If a federally insured credit union reaches or crosses an asset size threshold under this subpart on March 31, 2021, the NCUA will use the assets the federally insured credit union reported on March 31, 2020 for the purpose of determining the applicability of those thresholds.\nPlanning horizon means the period of 3 years over which capital planning projections extend.\nPre-provision net revenue means the sum of net interest income and non-interest income, less expenses, before adjusting for loss provisions.\nProvision for loan and lease losses means the provision for loan and lease losses as reported by the covered credit union on its Call Report.\nReverse stress test means a test that defines severely unfavorable outcomes and then identifies events or scenarios that lead to these outcomes. Examples of severely unfavorable outcomes are breaching regulatory capital, failing to meet obligations, or being unable to continue independent operations.\nScenarios are those sets of conditions that affect the U.S. economy or the financial condition of a covered credit union that serve as the basis for stress testing, including, but not limited to, NCUA-established baseline, scenarios and stress scenarios.\nSensitivity testing means testing the relationship between specific variables, parameters, and inputs and their impacts on analytical results.\nStress scenario means a scenario that is more adverse than that associated with the baseline scenario.\nStress test means the process to assess the potential impact of expected and stressed economic conditions on the consolidated earnings, losses, and capital of a covered credit union over the planning horizon, taking into account the current state of the covered credit union and the covered credit union's risks, exposures, strategies, and activities.\nStress test capital means net worth (less assistance provided under Section 208 of the Federal Credit Union Act, subordinated debt included in net worth, and NCUSIF deposit) under stress test scenarios.\nStress test capital ratio means a covered credit union's stress test capital divided by its total consolidated assets less NCUSIF deposit.\nTier I credit union means a covered credit union that has less than $15 billion in total assets.\nTier II credit union means a covered credit union that has $15 billion or more in total assets but less than $20 billion in total assets, or is otherwise designated as a tier II credit union by NCUA.\nTier III credit union means a covered credit union that has $20 billion or more in total assets, or is otherwise designated as a tier III credit union by NCUA.","path":["Title 12—Banks and Banking","CHAPTER VII—NATIONAL CREDIT UNION ADMINISTRATION","SUBCHAPTER A—REGULATIONS AFFECTING CREDIT UNIONS","PART 702—CAPITAL ADEQUACY","Subpart C—Capital Planning and Stress Testing"],"source_url":"https://www.ecfr.gov/api/versioner/v1/full/2026-08-25/title-12.xml","current_through":"2026-08-25","vintage":"","retrieved_at":"2026-08-27T02:24:16Z","sha256":"1f1cfe4301968a80acc2207f8be3fd51c7ba0adeeca773e9059d2cdaf5f5184d","source_id":"us-cfr","stale":true,"prev":"us/12-cfr-702.301","next":"us/12-cfr-702.303"},"notice":"GroundRules: Original legal text. Not legal advice."}