Comments due: NCUA (proposed rule; subordinated debt)
The National Credit Union Administration (NCUA) Board is proposing to amend the subordinated debt rule, finalized in December 2020 with an effective date of Jan. 1, 2022. The proposed rule would amend the definition of “grandfathered secondary capital” to include any secondary capital issued to the U.S. government or one of its subdivisions under an application approved before Jan. 1, regardless of the date funds are issued. The proposed change would benefit eligible low-income credit unions (LICUs) that are either participating in the U.S. Department of the Treasury’s Emergency Capital Investment Program (ECIP) or other programs administered by the U.S. government that can be used to fund secondary capital, if they do not receive the funds for such programs by Dec. 31, 2021. The proposal would also extend the expiration of regulatory capital treatment for these issuances to the later of 20 years from the date of issuance or Jan. 1, 2042.
Reg lookup: Subordinated Debt