Credit unions won't need to install special software to comply with the new rules. All they will need is a computer with Internet access, Internet Explorer 6.0 or higher, a valid e-mail address, a login and a password.

Special procedures will be implemented for those credit unions without computer access.

The new online profile and call report will begin to be in use for natural person credit unions in late 2009 and for corporate credit unions in 2010.

For additional information, go to: http://www.ncua.gov/OnlineFAQ.pdf.

Dallas Church Earns FCU Charter

ALEXANDRIA, Va. — The NCUA has granted a federal charter for Oak Cliff Christian Federal Credit Union in Dallas, the agency recently announced.

The credit union was chartered to serve members and employees of the Oak Cliff Bible Fellowship Church and its subsidiaries as well as students of its Christian Academy, all based in Dallas.

The credit union office will be located on the campus of the Oak Cliff Bible Fellowship Church in Dallas. The field of membership totals 8,500 potential members.

According to the application the organizers want to "offer the field of membership a place to confidently deposit their savings and investments with security for the future," and to provide a safe, sound democratic alternative to traditional financial institutions.

The NCUA has issued five federal credit union charters this year. In 2007, the agency issued 14.

NCUA Simplifies Rules on Trusts

ALEXANDRIA, Va. — The NCUA Board has approved an interim rule change which eliminates the concept of a "qualifying beneficiary" of a revocable trust account so coverage can be based on the naming of any beneficiary.

The change, which came a week after the FDIC made a similar policy shift, allows friends, in-laws, cousins, nieces and nephews are allowed to be beneficiaries under these insured accounts. Previously, only spouses, parents, siblings, children and grandchildren qualified as beneficiaries.

Last week, NAFCU wrote a letter to NCUA that said without the change, credit unions could lose deposits to banks because of the FDIC's decision.

13 CUs Shut Down So Far in 2008

ALEXANDRIA, Va. — Two credit unions closed last week, bringing the total number of federally insured credit unions to close this year to 13.

Postal Family Credit Union of Wichita Falls, Texas, has purchased the assets of TEXDOT-WF Credit Union, which state authorities closed last week. The NCUA liquidated N&W Poca Division Federal Credit Union in Bluefield, W.Va.

TEXDOT-WF Credit Union had approximately $1.8 million in assets and 530 members. It was a state-chartered credit union and was liquidated by the Texas Credit Union Department. Its latest financial report indicated that its assets declined 63.7% during the second quarter of 2008, and its liabilities increased 407.4%. Its equity dropped 63.7% during that period.

Postal Family Credit Union has $50 million in assets and more than 6,100 members.

The NCUA also liquidated N&W Poca Division Federal Credit Union, which had assets of $6 million and 1,194 members. Its latest financial report indicated that its assets declined 30.7% in the second quarter of 2008, and its loan income fell 7.2%.

All NCUSIF-insured accounts are covered up to $250,000.

Fryzel Warns Credit Unions Not to
Criticize the Safety of Bank Deposits

WASHINGTON — Credit unions should not question the safety of bank deposits in an effort to gain more members, NCUA Chairman Michael E. Fryzel wrote in a letter to the leaders of federal credit unions.

He sent the letter yesterday in the wake of complaints from the American Bankers Association about advertisements of two Texas credit unions that the FDIC alleged implied that bank deposits are somehow less secure than those at credit unions.

"NCUA has asked the credit unions to discontinue the advertising and refrain from making such remarks. This type of activity is, in my experience, uncharacteristic of credit unions. Credit unions do not need to criticize another financial institution regardless of its charter. Your performance is all that matters," he wrote.

Earlier this week, the NCUA and Texas Credit Union Commissioner Harold Feeney ordered Resource One Credit Union in Dallas to cease and desist using an ad that said: "What is safer then money in the bank? Depositing it at Resource One Credit Union." Later in the ad, after touting its competitive rates and the fact that it is not beholden to Wall Street, the credit union said, "Your bank may be failing but Resources One is NOT! Don't take chances with your money."

Last month, federal and state officials ordered another Texas credit union–Texas Dow Employees Credit Union in Lake Jackson–to stop using an ad that stated "Banking crisis? Not at TDECU."

Fed to Pay Interest on Formerly Sterile
Reserves, Increase Lending Capability

WASHINGTON — Financial institutions will soon be receiving interest on the money they are required to keep on deposit with the Federal Reserve, the Fed announced.

The central bank said the move will give it "greater scope to use its lending programs to address conditions in credit markets."

The change, which takes effect immediately, implementing a provision of the bill Congress passed last week designed to deal with the financial and credit crisis.

The amount available for 28- and 84-day cash loans to banks will also be increased.

The funds available for those loans will be increased to $150 billion each for the auction period that started last Monday. The auctions for November will also have $150 billion for the 28- and 84-day cash loans.

Bud Conrad, the chief economist of the economic consulting firm Casey Research, said increasing the amount of loan money is a risky proposition.

"The Fed does not have the entries on the balance sheet to do that. So they

are now offering interest on the deposits. That is so they can find the money to fund these big liquidity injections. That turns the Fed into a big bank, taking in deposits and making big loans," he said. "The Fed now makes loans to banks with their bad debt as collateral."

Treasury Opens MMF Guarantee

WASHINGTON — On Sept. 29, the U.S. Department of the Treasury opened its temporary guarantee program for money market funds.

Under the guarantee program, Treasury will guarantee the share price of participating money market funds that seek to maintain a stable net asset value of $1 per share, subject to certain conditions and limitations.

The program provides coverage to shareholders for amounts that they held in participating money market funds as of the close of business on Sept. 19, 2008. Although the program protects the accounts of shareholders, shareholders cannot sign up for the program individually.

Treasury has requested the Securities and Exchange Commission's assistance in administering the guarantee program. The commission regulates money market funds under the Investment Company Act of 1940.