Written by Tessema Tefferi, Regulatory Affairs Counsel
NCUA October Board Meeting. The NCUA Board held its monthly public meeting last Thursday, at which one final rule was approved and a monthly NCUSIF and Corporate Stabilization Fund report was provided. Here’s a link to the draft items considered.
The final rule the Board approved concerns the agency’s regulations governing the Community Development Revolving Loan Fund (CDRLF). As a background, the CDRLF provides financial support for credit unions serving predominantly low-income members. It offers funds in forms of loans and grants, and is administered by the Office of Small Credit Union Initiatives (OSCUI).
While the rule makes comprehensive changes to the CDRFL rule, there are some key aspects worth highlighting. First, the NCUA will have greater flexibility in terms of determining interest rates (the rule removes references limiting an interest rate to between 1 and 3 percent). Going forward, the NCUA will publish the interest rate in the Notice of Funding Opportunity, which will be periodically published in the Federal Register and provided through Letters to Credit Unions and other means. Second, the rule eliminates the requirement for matching, although the agency retains the discretion to require matching funds on a case-by-case basis. Third, a credit union that receives funds will be required, among other things, to issue a report annually to its members on the progress of providing needed community services, and submit a copy (or summary) of the report to the NCUA. The final rule will become effective 30 days after publication in the Federal Register.
November 9 NCUA Webinar. NCUA’s Board Chairman Debbie Matz will be hosting a town hall webinar on November 9, 2011, at 3:00pm EST. The announcement and instructions for how to sign-up can be found here. According to Chairman Matz, the webinar will feature updates on the corporate credit union system resolution, NCUSIF update, NCUA’s Regulatory Modernization Initiative and the agency’s 2012 budget.
The NCUA Report (October 2011 edition). October’s edition of The NCUA Report has been released and can be found here. The report includes articles on loan participations, economic outlook and credit risk management.