NCUA headquarters. Credit/NCUA
The NCUA announced Wednesday that it will remain open during the federal government shutdown and that federally insured accounts will continue to be protected by the National Credit Union Share Insurance Fund.
Because the NCUA operates independently of Congress and is funded through credit union fees and insurance transfers, its ability to regulate and insure credit unions remains unaffected by the lapse in federal appropriations.
At the same time, the NCUA joined other federal regulators in reminding lenders they may continue making loans subject to flood insurance requirements even while the National Flood Insurance Program is unavailable. Lenders must still perform flood determinations, provide complete and timely notices to borrowers, and evaluate safety, soundness and legal risks. The guidance also highlighted the role of private flood insurance as an alternative.
The shutdown, however, could place stress on credit unions with large numbers of federal employees among their members. The NCUA urged institutions to prepare by adopting flexible policies, communicating response plans, and offering special programs such as short-term loans or payment deferrals. Credit unions with facilities on federal property were also advised to plan for possible service interruptions.
The agency pointed to its Letter to Credit Unions 11-CU-05 as a resource for operational planning during government shutdowns.
“Consistent with safety and soundness, credit unions may want to consider offering special programs to assist impacted members,” the NCUA said.
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