Proposed Regulations

Recently, the National Credit Union Administration issued for public comment a notice of proposed rulemaking concerning the requirements for reporting and filing suspicious activity reports (SAR). The proposed changes to §748.1(c) would provide some consistency with the SAR regulations issued by the other four Federal Financial Institutions Examination Council regulators and would extend to credit unions the banks' practice of notifying Board of Directors of SAR filings.

Recently, the Small Business Administration (SBA) proposed for comment a lender risk rating system to assist SBA in assessing the risk of each active 7(a) Lender and Certified Development Company's (SBA Lender) SBA loan operations and portfolio. The proposed rating system would assess each active SBA Lender's risk on a uniform basis and identify those institutions whose SBA loan operations and portfolio require additional monitoring or other action. The proposal would also enable the agency to assess the aggregate strength of its 7(a) and 504 portfolios.

The proposal would allow Originators, and originating depository financial institutions acting as Originators, to accept checks at the point-of-purchase or at manned payment locations and convert the checks to ACH debits during back office processing.

Recently, the National Credit Union Administration (NCUA) issued an Advanced Notice of Proposed Rulemaking (ANPR) regarding permissible foreign currency investments for federal credit unions and corporate credit unions. The ANPR follows a rule adopted by the NCUA last year which permitted federally insured credit unions to accept member shares denominated in foreign currency.

On April 30, 2007, the Board of Governors of the Federal Reserve System published in the Federal Register proposed rules amending Regulations B, E, M, Z, and DD. Generally, the proposed rules withdraw provisions in each regulation added by interim final rules in 2001 to implement the Electronic Signatures in Global and National Commerce Act (E-Sign Act).

On February 5, 2007, the Federal Deposit Insurance Corporation (FDIC) issued for public comment a proposed rule to strengthen the regulatory framework for consideration of applications or notices for industrial banks or industrial loan companies (ILCs) owned by financial companies that are not subject to consolidated supervision by the Federal Reserve Board or the Office of Thrift Supervision.

Recently, the Fannie Mae entered into a Cooperation Agreement (Agreement) with the Office of Federal Housing Enterprise (OFHEO) and the New York Attorney General's Office to adopt a Home Valuation Protection Code (Code). As part of the agreement, Fannie Mae, along with Freddie Mac and other industry players, will also contribute to the establishment of an Independent Valuation Protection Institute (Institute). Fannie Mae has requested comments from its customers a

As directed by the Bank Secrecy Act (BSA), the Department of Treasury's FinCEN requires financial institutions, including credit unions, to report transactions in currency in excess of $10,000. The Money Laundering Suppression Act of 1994 amended the BSA by establishing a statutory system of exempting transactions by certain customers of depository institutions. This system devised two types of exemptions: mandatory exemptions and discretionary exemptions.

The proposed rule would modify the calculation of net worth ratio in cases involving mergers of natural person credit unions so that the post-merger ratio would be calculated by dividing the sum of the acquiring credit union's retained earnings and the merging credit union's retained earnings by the total assets (under GAAP, total assets are the sum of the acquiring credit union's total assets at book value and the merging credit union's total assets at fair value).

Recently, the National Credit Union Administration (NCUA) issued a proposed rule to revise its rules relating to the accuracy of advertising and notice of insured status. Specifically, the proposed changes seek clarify and reduce the burden of existing rules regarding shared branch networks which include nonfederally-insured credit unions.

Corporate credit unions have played an important role in the credit union industry. They provide critical services to natural person credit unions, including payment and clearing services, enabling access to wire transfer facilities and automated clearing house transactions, as well as loan and investments services that provides small credit unions to achieve economies of scale and access to greater market returns otherwise unavailable to them. They have also been an important source of liquidity for credit unions, and have served as agents for the NCUA on loans funded by the NCUA's Central Liquidity Facility.

In response to questions concerning the interagency guidelines issued by the National Credit Union Administration (NCUA), Federal Reserve, and Office of Thrift Supervision (OCC), the agencies issued new, amended guidelines.

Recently, the Federal Housing Finance Agency (FHFA) issued an Advance Notice of Proposed Rulemaking (ANPR) regarding the duty for the Federal Home Loan Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac) to serve underserved markets.

The proposed rule would make significant changes to Part 704 of NCUA's rules and regulations, which pertains to corporate credit unions (corporates). The issues addressed include: capital requirements, investment authority, asset and liability management (ALM), corporate governance and corporate credit union service organizations (CUSOs).

On December 14, 2001, NACHA Rules Work Group #35 proposed amendments to the NACHA Board that would modify certain aspects of the Rule Enforcement Procedures.

The Federal Accounting Standards Board (FASB) has issued the final Statements on Business Combinations, Number 141 and Goodwill and Other Intangible Assets, Number 142. These Statements could potentially change accounting methods for credit union mergers in significant ways.

The Federal Reserve Board is requesting comments on a proposed rule amending Regulation Z to address concerns related to predatory practices in mortgage lending. The proposed amendments extend the protections of the Home Ownership and Equity Protection Act (HOEPA) to more loans, prohibit certain acts or practices such as loan flipping, strengthen HOEPA's prohibition on loans based on homeowners' equity without regard to repayment ability and revise HOEPA disclosures received by consumers before closing.

The Federal Reserve Board has issued a proposed rule amending the Official Staff Commentary on Regulation E. The commentary applies and interprets the requirements of Regulation E and assists financial institutions in compliance with the regulation.

On November 26, 2002, the Board of Governors of the Federal Reserve issued proposed revisions to the official staff commentary on Regulation Z, which applies and interprets the requirements of Regulation Z.