Small CU Definition, Rural FOM and Payday Lending On September NCUA Agenda: Onsite Coverage
DENVER — The NCUA will introduce a new regulatory relief package at its Sept. 20 board meeting, Chairman Debbie Matz told state regulators during her general session audience Wednesday at the 2012 NASCUS Summit.
The package will include a proposal to increase the asset size threshold of $10 million that defines small credit unions. The move would exempt more credit unions from recent rules on interest rate risk and liquidity risk, Matz said, as well as qualify more for assistance from the agency’s Office of Small Credit Union Initiatives.
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The proposed rule would be open to comment before being finalized.
The NCUA Board will also propose expanding rural fields of membership that would allow credit unions that serve rural areas in large states to expand more easily, Matz said.
Another proposal that will be on the board agenda would allow credit unions to invest in the Treasury’s Inflation-Protected Securities, or TIPS.
Finally, the board will be collecting comments on ways the NCUA can make programs that offer payday loan alternatives more attractive. Currently, Matz said, about 400 credit unions offer payday loan alternatives through the NCUA’s program.
“I know these programs are expensive, but I know from working at a credit union that serves the military, it’s an important service for some credit unions to provide,” she said.
Matz said the NCUA will be evaluating various components of credit union payday lending, such as the “balancing act” of charging a high enough fee to cover risk while protecting consumers.
“We would really like to know how we can make it a better program,” she said.
The NCUA’s General Counsel Office will also issue letters that will define two member business lending issues. First, will be legal guidance on how credit unions can qualify for MBL restructuring blanket waivers, which would eliminate the need for personal guarantees from borrowers.
The letter would define which loans would qualify for the blanket waiver under which circumstances, said Steve Bosack, Matz’s chief policy adviser.
The General Counsel’s office will also release a letter that will expand the numbers of vehicles required to qualify as a business fleet, Matz said.
“We’re trying to make it a higher definition so more businesses can get credit union loans under this definition,” Matz said.