August 9, 2010
NASCUS Responds to NCUA 2010 Rule Review
Arlington, Va. In response to the National Credit Union Administration (NCUA) annual Rule Review, NASCUS suggested the agency provide parity on loan participation rules and consolidate regulations for the share insurance fund in Part 741.
NCUA requires state-chartered, federally insured credit unions (FISCUs) to obtain Regional Director approval when purchasing a loan participation interest at an institution not insured by the share insurance fund, including financial institutions insured by the Federal Deposit Insurance Corporation (FDIC). Federal credit unions are exempt from the Regional Director approval.
NASCUS requests parity for FISCUs in this regulation, therefore streamlining the rules regarding loan participations to apply equally to state and federal credit unions. "This change will create parity for state and federal credit unions engaged in participation loans, alleviate unnecessary regulatory burden for state-chartered credit unions as well as free up state and federal examination staff resources," wrote NASCUS.
Second, NASCUS encourages the NCUA to consolidate all insurance rules in Part 741 of NCUA's Rules and Regulations. FISCUs must reference rules in both Part 741 and in applicable rules incorporated by reference in areas for federal credit unions. "This unnecessary process complicates compliance, costs valuable time and resources and confuses credit unions," stated NASCUS. The consolidation of insurance rules in Part 741 would reduce regulatory burden for credit unions and examiners.
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Kate Hartig, VP, Public Relations and Legislative Affairs, (703) 528-0669 or firstname.lastname@example.org