Share insurance fund report, final lending rule on NCUA Board agenda next week

The March 14 open meeting for the federal regulator of credit unions is expected to be a fairly brief one, with only two items slated for its agenda: a quarterly report on the fund that insures credit union member savings; and a final rule on loans to members.

Last August, the NCUA Board proposed changes to its rules on loans to members with the aim of making them clearer and easing compliance. The proposal:

  • identified all the various maturity limits set for federal credit union loans in one section of the rule;
  • explicitly stated that the maturity date for a “new loan” under generally accepted accounting principles (GAAP) is calculated from the new date of origination;
  • sought comments on whether the agency should provide longer maturity limits for 1-to-4 family real estate loans and other loans permitted by the Federal Credit Union Act (FCU Act) such as home improvement, mobile home, and second mortgage loans; and
  • sought comments on proposed clarifications regarding limits on loans by federally insured (including state-chartered) credit union loans to a single borrower or group of associated borrowers; and on whether there should be a universal standard limit instead of current product-specific limits (specifically, regarding commercial loans and loan participations).

The proposed rule was issued with a comment period that closed Oct. 9.

Meanwhile, NCUA has already announced that the National Credit Union Share Insurance Fund (NCUSIF) is slated to distribute $160.1 million to insured credit unions this year. That money is the amount in the fund at year-end 2018 that exceeded the “normal operating level” the agency board set for the fund’s equity ratio. The NOL is 1.38%, but the fund closed 2018 at a level of 1.39%. NCUA announced the planned distribution Thursday.

The March 14 open board meeting begins at 10 a.m. A closed meeting follows.

March 14 NCUA Board meeting agenda

RR: Credit unions to receive more than $160 million in ‘equity distribution,’ agency announces (March 7, 2019)