Compliance Blog

Yesterday, the NCUA Board was very, very busy.  They approved three compliance related proposals.  Those materials are now available as outlined below.  I didn't provide a whole lot of analysis here.  Rather, I pulled much of the purpose for each rule from the NCUA proposals and provided links to the actual language.  I suggest that you read the material below.  If you think that a specific proposal would affect your credit union, then by all means download the proposal and give it a read.  Our Reg Affairs staff will issue Regulatory Alerts on these shortly.  (Thanks, Carrie!)  In the mean time, I'll read through these over the next few days and holler if anything catches my eye.

1. NCUA issued a proposal to use median family income (MFI) to determine if a credit union qualifies for a low-income designation and assistance from the Community Development Revolving Loan Fund (CDRLF).   NCUA indicated that it designed the proposal to eliminate the confusion associated with adjusting median household income (MHI) in metropolitan areas with higher costs of living.   NCUA also indicates that it will better align NCUA criteria for a low-income designation with the criteria for the addition of an underserved area to a federal credit union (FCU) field of membership and certification as a Community Development Financial Institution (CDFI).  You may access the proposal here.
2. NCUA also issued a proposal to revise the requirements for use of the official insurance sign and official advertising statement to permit insured credit unions to use the basic form of the official advertising statement, a shortened form, or the official sign in advertisements. NCUA hopes the proposal will give credit unions added flexibility in advertisements. As compared to the current requirement, credit unions will be able to use the shortened form or the official insurance sign in advertisements as alternatives to the basic official advertising statement; under the current rule, credit unions may only use the shortened form if they also include the official sign.  You may access the proposal here.
3. NCUA also issued a proposal to change its credit union service organization (CUSO) rule by adding two new categories of permissible CUSO activities: credit card loan origination and payroll processing services. The proposal would also add new examples of permissible CUSO activities within existing categories and would expand the scope of two categories of services to include persons eligible for credit union membership. The proposal would impose new regulatory limits on the ability of credit unions to recapitalize their CUSOs in certain circumstances. While the CUSO rule generally only applies to federal credit unions (FCUs), the proposal would revise and extend to all federally insured credit unions the provisions ensuring that credit union regulators have access to books and records and that CUSOs are operated as separate legal entities. The proposal would also clarify that CUSOs may buy and sell participations in loans they are authorized to originate under the current rule. Finally, NCUA proposes to delete as unnecessary the section in the current rule concerning amendment requests. These amendments will clarify the rule while enhancing CUSO operations and addressing safety and soundness concerns.   You may access this proposal here.

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Last evening, NAFCU's softball team (0-2) lost both ends of a doubleheader, 15-5 and 6-3.   Gold stars go to Eddie "Arnold Palmer" Ambrose, Quincy "We Are Marshall" Enoch (4-for-4 in the second game), and Larry "The Acrobat" Palmer, who reportedly did a flip after a gold-glove catch in center field.  They are just a few of the folks who work their tails off for NAFCU's members.  Many of you haven't met many of our staff, so here's a pic of some of the team members. Most importantly, everyone had a great time, no one was hurt, and we spent the better part of 2 hours extolling the virtues of financial cooperatives to the opposing team.  Have a great weekend, everyone.