Sept. 13, 2012 – More than half, or 553, of the federal credit unions notified by NCUA recently of their eligibility for the agency’s low-income designation said they want the designation, the agency announced Wednesday, raising the total number of LICUs to 1,740.
NCUA last month announced it had found that 1,003 federal credit unions were eligible for the designation but had not requested it. It invited these institutions to reply by Sept. 10 if they wanted the designation to facilitate streamlined approval.
The newly designated LICUs serve 5.9 million members and have more than $49 billion in combined assets, the agency said. The overwhelming majority of recently designated LICUs are small credit unions, NCUA said. Nearly 80 percent have assets of less than $100 million; the median asset size of these institutions is $24.6 million.
As for federal credit unions that did not reply to their Aug. 7 eligibility letters, NCUA on Wednesday notified them again. They will have 30 days to opt-in to accept the designation.
“We thought it was important for credit unions to be made aware of their eligibility so they could take advantage of tools to better serve their members and communities,” said NCUA Board Chairman Debbie Matz. “We, therefore, cut red tape and made it possible for eligible federal credit unions to opt-in to the low-income designation.
NCUA notes that low-income-designated credit unions:
- are eligible to apply for loans and grants from NCUA’s Office of Small Credit Union Initiatives’
- are exempt from the statutory cap on member business lending;
- can accept supplemental capital; and
- may accept non-member deposits from any source.
This NCUA initiative was included in President Obama’s relief and recovery package announced last month to help 27 drought-stricken states. Nearly half, or 260, of the credit unions accepting the designation are headquartered in affected states. These institutions represent 49 percent of assets and 50 percent of members of the 553 newly designated institutions.