ALEXANDRIA, Va. — How much expertise should a federal creditunion have on staff and should it be required to have a minimalCAMEL rating or net worth?

Those are among the questions that the NCUA Board sent out for a60-day comment period on Thursday.

The agency has been engaged since last year in trying to come upin a policy for allowing credit unions to trade in certain kinds ofderivatives, especially as a way of protecting against interestrate risk.

The other questions are: Should a FCU have to demonstratethat it has a “material” interest rate risk or otherrisk management need to be granted independent derivativesauthority? Should FCUs be limited to interest rate swaps and capsand should swaps be limited to pay-fixed/receive-floatinginstruments? Should the NCUA establish exposure limits or mandatethe credit union's board to establish them? Are there “ways tomitigate counterparty risk besides posting collateral?”

NCUA Chairman Debbie Matz said the agency's goal is to “safelyallow more credit unions to use derivatives responsibly as a hedgeagainst interest rate risks.”

The agency initially sought input last June but Matz said some of the responses fromtrade associations and credit unions indicated that the agencyneeded to have more information before issuing a final rule. There is a 60-day period to respond to the agency'squestions.