LICU Opt-In Process Aims to Expand to State-Chartered CUs: Onsite Coverage
DENVER — The NCUA is attempting to expand its opt-in process to low income credit union designation approval this month by working with state regulators to identify eligible state-chartered credit unions, NCUA Chairman Debbie Matz announced Wednesday during her keynote session at the 2012 NASCUS Summit in Denver.
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Matz said the NCUA will meet with NASCUS President/CEO Mary Martha Fortney to brainstorm ways to initiate an LICU opt-in approval process similar to the one NCUA launched for federal credit unions last month.
The program was part of an administration drought relief package and would make more credit unions eligible to waive the 12.25% cap on member business lending.
The NCUA would like to be able to verify eligible state-chartered credit unions every quarter, after state regulators provide NCUA with appropriate member income data. The agency would then notify state regulators which credit unions are eligible; state regulators would complete the LICU eligibility designation process.
Fortney told Credit Union Times the program is still in the very early stages, and will be subject to each state’s low-income program rules. Some states don’t have low-income designations, she added.
Rather than that ask federally chartered credit unions to complete a full application and approval process, the NCUA sent a letter to 1,000-some credit unions, notifying the of their LICU eligibility, and offering them the chance to gain LICU designation by simply replying to the letter.
To date, Matz said 553 credit unions have responded and accepted the LICU designation. The NCUA will send a second letter to eligible federal credit unions this week, because some credit unions have said they didn’t receive the letter, or haven’t yet had a chance to meet with their boards to accept the offer.