WASHINGTON – NCUA has proposed an amendment to revise Part 704, the corporate CU regulation. The new amendment would allow all corporates to engage in loan participation, something individual corporates asked NCUA for this year in the form of waivers. NCUA's take on capital was one of the most anticipated aspects. Corporates were concerned NCUA was going to change the definitions of member capital and paid-in capital to be more in line with GAAP so it is comparable with other financials. The board however elected not to change the definitions. The rule also eliminated the separate limitation based on the sum of RUDE and paid-in capital. In the proposed reg, all references to capital include membership capital, RUDE and PIC. One area where corporates are not pleased is in the minimum 2% RUDE ratio. The NCUA Board feels the 2% ratio is useful in determining capital adequacy. Corporates feel it is a regulatory burden. Corporates are still evaluating the changes on credit concentration risk limits. Another positive is allowance for corporates to take on lower grade investments. Odds and ends * CUNA Mutual Group surged onto the corporate scene with a new product, CUNA Mutual Notes. It is an investment product for corporates that CUNA Mutual says is unique because they are structured as funding agreements, issued by a separate account of CUNA Mutual providing a fixed or floating coupon and return of principal. They are only double AA rated, however they are guaranteed by CUNA Mutual Life Insurance Company. So far 11 corporates have invested about $200 million in Notes. * U.S. Central now has a major Canadian player as a member – the $3.4 billion (Canadian) Credit Union Central of British Columbia. As of the beginning of November, CUBC had about $35 million in term certificates invested in U.S. Central. More interesting future deals may revolve around cross-border payment services.