August 21, 2020

New alert details NCUA's proposed rule on FCU fees

NCUADuring its July board meeting, the NCUA proposed a rule to exclude from total assets any loan a federal credit union (FCU) reports under the PPP or similar future programs. NAFCU sent a Regulatory Alert to member credit unions detailing the proposal and seeking feedback on the approach to operating fees.

The rule would amend the period used for the calculation of an FCU's total assets to the average total assets reported on the FCU's previous four call reports – rather than using the Dec. 31 call report data from the previous year – reducing the risk the NCUA under- or over-collects operating fees relative to the board-approved budget and providing more certainty to FCUs about the operating fee charges for the forthcoming year.

NAFCU highlighted in the Regulatory Alert that the proposal will impact all FCUs. It also provides calculations for merged or converted FCUs and makes technical amendments to clarify that no refund of operating fees is available for FCUs that convert to any other type of charter, regardless of timing.

The association would like credit unions' feedback on whether:

  • credit unions agree with the proposed calculation of total assets based on the four most recently reported quarters;
  • the approach is beneficial to the credit union, such as accounting for seasonal fluctuations;
  • the NCUA should adopt a different approach to mergers and conversions than what is proposed; and
  • the NCUA should make any other amendments regarding operating fees.

Comments will be due to the NCUA 60 days after the proposal is published in the Federal Register.