CARES Act, signed last week, permits more credit union access to Central Liquidity Facility, more

The National Credit Union Administration (NCUA) and credit unions would have a few added authorities for dealing with the challenges posed amid the coronavirus pandemic under the Coronavirus Aid, Relief and Economic Security Act (CARES Act) signed by the president Friday.

The provisions, outlined in a release from the NCUA, include:

  • Authority for the NCUA Board to expand access to and increase the borrowing authority for the Central Liquidity Facility. NCUA Board Chairman Rodney Hood said this provision will enhance the CLF’s role as a liquidity backstop for the credit union system.
  • Authority for credit unions to provide guaranteed loans to businesses and self-employed individuals through the U.S. Small Business Administration’s paycheck protection program. This, Hood said, will permit credit unions to assist members with payroll, benefits, and other eligible expenses.
  • Authority for the NCUA Board to increase share insurance coverage for noninterest-bearing transaction accounts.
  • Relief from accounting requirements and impairments resulting from loan modifications for borrowers affected by the coronavirus pandemic; this includes temporary relief (as reported here previously) from the implementation of the Financial Accounting Standards Board’s current expected credit losses methodology (CECL).

Hood said he looks forward to working with the rest of the board “to provide additional coverage for credit union members with applicable accounts that have balances above the current limit of $250,000.”