ALM First, which conducted theNCUA's derivatives pilot program, will host a webinar on the newregulation. The free event is open to any credit union and isscheduled for 10:30 a.m. Central Time on Thursday, Feb. 20.

Partner Emily Hollis, CFA, an expert in asset liabilitymanagement, will lead the one-hour session, which will focus on howto enhance investment programs under the rule. The webinar willalso include a Q&A session.

“Derivatives can serve as a valuable tool for some creditunions, offsetting the interest rate risk that is inherent intoday's financial environment,” Hollis said. “When used properly,derivatives allow eligible credit unions to compete moreeffectively, but their restrictions and guidelines must beunderstood and followed.”

ALM First is currently the only organization that has approvedderivative credit union clients, according to a release from thefirm. The ruling limits derivative use to federally regulatedcredit unions with assets over $250 million, a CAMEL rating of 1, 2or 3 and a management rating of 1 or 2.

The new rule added interest rate swaps, purchased interest ratecaps, purchased interest rate floors and Treasury note futures toinvestment authorities for qualified credit unions.

“Derivatives authority is beneficial to the credit unionindustry, but using them effectively requires education andpreparation,” Hollis said. “This webinar will examine how creditunions can operate under the ruling and underscore itsguidelines.”

Registration is available online.