Application period for 2nd ECIP funding round ends in 6 days

Treasury’s Emergency Capital Investment Program (ECIP) is offering a second round of funding, with applications due by 11:59 p.m. Eastern on Jan. 31, the federal credit union regulator told credit unions in an “express” announcement Wednesday.

The application for this second round of funding opened in December, with the ECIP expected to have between $160 million and $340 million available for investment in qualified institutions.

The ECIP was established by the Consolidated Appropriations Act, 2021, to encourage low- and moderate-income community financial institutions to augment their efforts to support small businesses and consumers in their communities.

The National Credit Union Administration (NCUA), in its announcement Wednesday, said credit unions participating in the second round of ECIP funding and that meet the eligibility requirements under the NCUA’s subordinated debt rule may also apply for regulatory capital treatment under the pre-approval requirements outlined in the rule.

“As in the ECIP’s first round, Treasury requires approved, qualified financial institutions to select a maturity of either 15 or 30 years during the closing process,” the NCUA said. “Currently, the NCUA’s Subordinated Debt rule limits the maximum maturity of Subordinated Debt Notes to 20 years.”

The agency is reviewing comments received on a September proposed rule that would “provide flexibility” on the maximum maturity of subordinated debt notes, the agency said. For now, it noted, a credit union applying to the NCUA for regulatory capital treatment should indicate in its application that it would elect either the 15- or 30-year maturity in the event the agency board finalizes the proposed rule allowing a longer maturity period. “If the Board does not finalize the proposed changes, second-round issuances will be subject to the 20-year maturity limit in the current Subordinated Debt rule,” the agency wrote.

The NCUA said it encourages credit unions to submit their subordinated debt applications to the appropriate NCUA supervision office by Feb. 28; and to contact the appropriate supervision office with any questions about the application process.

ECIP notice of funding availability

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