Fixed-assets rule clarified, more review ahead
NCUA Board Member Rick Metsger (shown here with Chairman Debbie Matz) wants to have a 'substantive' review of the fixed-assets rule. (NAFCU photo)
Sept. 13, 2013 – NAFCU on Thursday welcomed the prospect of a substantive review of NCUA’s fixed-assets rule, contemplated in discussion between agency Board Member Rick Metsger and Chairman Debbie Matz during Thursday’s open meeting.
The three-member board approved technical amendments to the rule in Thursday’s open meeting, voting 3-0. The changes clarify the language of the rule but make no other substantive changes. They take effect in about 60 days.
Metsger, speaking prior to the board’s vote, noted interest in reviewing the rule’s fit with the way credit unions do business. He asked about the opportunity to revisit the rule later this year on a “substantive basis,” and Matz agreed that would happen.
NAFCU President and CEO B. Dan Berger welcomed the board’s agreement on the need to revisit this rule. He said the association welcomes the clarifications to the rule approved Thursday, but said numerous changes are needed. He pointed specifically to the current rule’s 5 percent limit on a federal credit union’s investment in fixed assets.
“We appreciate that they heeded our concerns,” Berger said. “We believe credit unions should be able to make their own business decisions, including decisions about the extent to which they should invest in additional fixed assets such as branches, among other things.”
In other action Thursday, the board:
- Issued a proposed rule that would allow federal credit unions to create and fund “charitable donation accounts” under preapproved incidental powers authority related to donations to 501(c)(3) organizations. The accounts could hold up to 3 percent of net worth and could be invested. Donations of at least 51 percent of total return would have to be made at least every five years. Comments are due 30 days after publication in the Federal Register.
- Approved a community charter expansion for People’s Advantage FCU in Petersburg, Va. Noting a low rate of penetration of the current membership field, NCUA Board Member Michael Fryzel asked agency staff to report back in one year on the institution’s FOM penetration and growth.
NAFCU is preparing a Final Regulation and Regulatory Alert for members on Thursday’s agency board actions.
NAFCU comment letter (NCUA regulatory review)