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The Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the National Credit Union Administration, and the state regulators recognize the serious impact of Hurricane Michael on the customers, members, and operations of many financial institutions and will provide appropriate regulatory assistance to affected institutions subject to their supervision. The agencies encourage institutions operating in the affected areas to meet the financial services needs of their communities.

A complete list of the affected disaster areas can be found at www.fema.gov (opens new window).

Lending: Financial institutions should work constructively with borrowers in communities affected by Hurricane Michael. Prudent efforts to adjust or alter terms on existing loans in affected areas should not be subject to examiner criticism. Modifications of existing loans should be evaluated individually to determine whether they represent troubled debt restructurings. This evaluation should be based on the facts and circumstances of each borrower and loan, which requires judgment, as not all modifications will result in a troubled debt restructuring. In supervising institutions affected by Hurricane Michael, the agencies will consider the unusual circumstances these institutions face. The agencies recognize that efforts to work with borrowers in communities under stress can be consistent with safe-and-sound practices as well as in the public interest.

Temporary Facilities: The agencies understand that many financial institutions may face staffing, power, telecommunications, and other challenges in re-opening facilities after Hurricane Michael. In cases in which operational challenges persist, the primary federal and/or state regulator will expedite, as appropriate, any request to operate temporary facilities to provide more convenient availability of services to those affected by Hurricane Michael. In most cases, a telephone notice to the primary federal and/or state regulator will suffice initially to start the approval process, with necessary written notification being submitted shortly thereafter.

Publishing Requirements: The agencies understand that the damage caused by Hurricane Michael may affect compliance with publishing and other requirements for branch closings, relocations, and temporary facilities under various laws and regulations, as applicable. Institutions experiencing disaster-related difficulties in complying with any publishing or other requirements should contact their primary federal and/or state regulator.

Regulatory Reporting Requirements: Institutions affected by Hurricane Michael that expect to encounter difficulty meeting the agencies’ reporting requirements should contact their primary federal and/or state regulator to discuss their situation. The agencies do not expect to assess penalties or take other supervisory action against institutions that take reasonable and prudent steps to comply with the agencies’ regulatory reporting requirements if those institutions are unable to fully satisfy those requirements because of the effects of Hurricane Michael.
The agencies’ staffs stand ready to work with affected institutions that may be experiencing problems fulfilling their reporting responsibilities, taking into account each institution’s particular circumstances, including the status of its reporting and recordkeeping systems and the condition of its underlying financial records.

Community Reinvestment Act (CRA): Financial institutions, as applicable, may receive CRA consideration for community development loans, investments, or services that revitalize or stabilize federally designated disaster areas in their assessment areas or in the states or regions that include their assessment areas. For additional information, institutions should review the Interagency Questions and Answers Regarding Community Reinvestment at https://www.ffiec.gov/cra/qnadoc.htm (opens new window).

Investments: The agencies realize local government projects may be negatively affected by Hurricane Michael. Institutions should monitor municipal securities and loans affected by Hurricane Michael. Appropriate monitoring and prudent efforts to stabilize such investments are encouraged.

For more information, refer to the Interagency Supervisory Examiner Guidance for Institutions Affected by a Major Disaster, which is available as follows:

CSBS: https://www.csbs.org/interagency-supervisory-examiner-guidance-institutions-affected-major-disaster (opens new window)

FDIC: https://www.fdic.gov/news/news/financial/2017/fil17062.html (opens new window)

FRB: https://www.federalreserve.gov/supervisionreg/srletters/sr1714a1.pdf (opens new window)

OCC: https://www.occ.gov/news-issuances/bulletins/2017/bulletin-2017-61.html (opens new window)

NCUA: https://www.ncua.gov/Resources/Documents/SL-17-02-examiner-guidance-institutions-affected-major-disaster-enclosure.pdf (opens new window)

ALEXANDRIA, Va. (Oct. 12, 2018) – National Credit Union Administration Chairman J. Mark McWatters today congratulated Chief of Staff Sarah Vega on her selection as President and Chief Executive Officer of the Cooperative Credit Union Association and thanked her for her long and valuable service to the NCUA:

“Sarah’s many contributions to this agency and to the financial industry over the past decade have helped create a safer, sounder, and more responsive credit union system,” McWatters said. “She came here as the financial crisis threatened credit unions and helped guide the agency’s response. She worked diligently to make the NCUA more flexible, efficient, accountable, and effective. She built strong relationships with industry stakeholders, our sister agencies, and elected officials at the state and national levels. I congratulate Sarah on this new opportunity; I look forward to our continued relationship; and I offer my deepest thanks for her guidance and partnership.”

Vega joined the NCUA in 2008 as chief of staff to then-Chairman Michael E. Fryzel, subsequently serving as senior policy advisor to Fryzel and to Board Member McWatters before being again named Chief of Staff in 2017.

She is a former Director of the Illinois Department of Financial Institutions, and before being named Director, she served as the Administrator of the Department’s Credit Union Division, which regulates state-chartered credit unions. She served on the Board of Directors of the Federal Home Loan Bank Chicago and on the Board of Directors of the National Association of State Credit Union Supervisors, serving as the Association’s Chairman from 1999 to 2000.

Member Deposits Protected up to $250,000 by Share Insurance Fund

ALEXANDRIA, Va. (Oct. 12, 2018) – The National Credit Union Administration today liquidated Radio, Television and Communication Federal Credit Union of Staten Island, New York.

Palisades Federal Credit Union of Pearl River, New York, immediately assumed most of Radio, Television and Communication Federal Credit Union’s assets and all members, shares, and loans. Palisades Federal Credit Union is a federally chartered credit union has assets of nearly $192 million and serving 14,351 members, according to its most recent Call Report.

Members’ accounts remain insured by the National Credit Union Share Insurance Fund. Administered by the NCUA, the Share Insurance Fund insures individual accounts up to $250,000, and a member’s interest in all joint accounts combined is insured up to $250,000. The Share Insurance Fund separately protects IRA and KEOGH retirement accounts up to $250,000. The Share Insurance Fund has the backing of the full faith and credit of the United States.

Members with questions about their accounts may contact Palisades Federal Credit Union at 800.438.7415 between 9 a.m. and 5 p.m. Eastern on Monday, Tuesday, Thursday, and Friday; from 10 a.m. to 5 p.m. on Wednesday; and from 9 a.m. to 1 p.m. on Saturday. Members also may find insurance coverage information on the Share Insurance Coverage page (opens new window) of the NCUA’s consumer website, MyCreditUnion.gov (opens new window).

The NCUA made the decision to liquidate Radio, Television and Communication Federal Credit Union and discontinue its operations after determining the credit union was insolvent with no prospect for restoring viable operations on its own.

At the time of liquidation and subsequent purchase by Palisades Federal Credit Union, Radio, Television and Communication Federal Credit Union served 416 members and had assets of $3 million, according to its most recent Call Report. Chartered in 1964, Radio, Television and Communication Federal Credit Union served various groups in New York.

Radio, Television and Communication Federal Credit Union is the seventh federally insured credit union liquidation in 2018.

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NCUA is the independent federal agency created by the U.S. Congress to regulate, charter and supervise federal credit unions. With the backing of the full faith and credit of the United States, NCUA operates and manages the National Credit Union Share Insurance Fund, insuring the deposits of account holders in all federal credit unions and the overwhelming majority of state-chartered credit unions. At MyCreditUnion.gov (opens new window), NCUA also educates the public on consumer protection and financial literacy issues.

“Protecting credit unions and the consumers who own them through effective regulation”

Board Action Bulletin

Board Proposes Simplifying Bylaws, Adding Clearer Guidance

ALEXANDRIA, Va. (Oct. 18, 2018) – The National Credit Union Administration Board held its ninth open meeting of 2018 at the agency’s headquarters today and unanimously approved two items:

• A supplemental final rule that amends the agency’s 2015 risk-based capital rule to delay the effective date of the rule until Jan. 1, 2020 and raise the asset threshold for a complex credit union from $100 million to $500 million.
• A proposed rule to clarify, update, and simplify federal credit union bylaws.

Risk-Based Capital Rule to Become Effective in 2020

Federally insured credit unions subject to the agency’s risk-based capital rule will have an additional year to prepare under a supplemental final rule (opens new window) approved by the Board.

“When I became Chairman, one of my priorities was to revisit the risk-based capital rule to make it less burdensome, and we have done that,” Board Chairman J. Mark McWatters said. “Through a thoughtful, collaborative process, with significant input from credit union stakeholders and careful analysis by agency staff, we made changes that provide a measure of regulatory relief while maintaining the safety and soundness of the Share Insurance Fund.”

“This final rule will provide regulatory relief to non-complex credit unions, relief that similarly sized banks do not receive,” Board Member Rick Metsger said. “It will protect the vast majority of well-run and well-capitalized credit unions and reduce the chances of them paying losses when a small number of credit unions gamble with other people’s money.”

The supplemental final rule moves the effective date of the risk-based capital rule approved in October 2015 to Jan. 1, 2020. The amendments in this final rule also become effective at the same time. During the one-year delay, the NCUA’s current prompt corrective action requirements remain in effect.

The rule raises the current $100 million asset threshold for defining a complex credit union to $500 million. As a result, an additional 1,026 federally insured credit unions—based on Dec. 31, 2017, Call Report data—will be exempt from the rule. Only 531 complex credit unions will be subject to the rule when it goes into effect, and more than 98 percent of all complex credit unions will be considered well-capitalized.

A slide presentation summarizing the final rule (opens new window) is available online.

Proposed Bylaw Changes Issued for Comment

Credit unions will have an opportunity to comment on a proposed rule (opens new window) that would clarify, update, and simplify federal credit union bylaws.

The proposed rule clarifies bylaw provisions and provides detailed guidance to help credit union officials, employees, and members better understand provisions, particularly a credit union’s ability to limit services to a disruptive or abusive member.

The proposed rule retains the Federal Credit Union Act requirement that credit unions must use bylaws adopted by the agency. This is necessary to maintain consistency and protect fundamental member rights.

Comment on the proposed rule must be received within 60 days of publication in the Federal Register.

The NCUA tweets all open Board meetings live. Follow @TheNCUA (opens new window) on Twitter, and access Board Action Memorandums and NCUA rule changes at www.ncua.gov. The NCUA also live streams, archives and posts videos of open Board meetings online.

ALEXANDRIA, Va. (Oct. 23, 2018) – The National Credit Union Administration Board has re-scheduled its December open meeting and posted the video recording of its September open meeting (opens new window).

The December meeting is now scheduled for Thursday, Dec. 13, beginning at 10 a.m. Eastern. The meeting, like all NCUA open board meetings, will be available on livestream from the agency’s website.

At the September open meeting, the Board unanimously approved two items:

• A proposed rule amending the agency’s regulation requiring real estate appraisals for certain transactions to provide a measure of regulatory relief.
• A request from the Texas Credit Union Department to revise its member business lending rule to provide parity with the NCUA’s rule following changes made in June 2018.

The Chief Financial Officer briefed the Board on the second-quarter performance of the National Credit Union Share Insurance Fund, which continued recent growth trends.

The Office of the General Counsel briefed the Board on the adoption of a resolution to appoint two administrative law judges in the Office of Financial Institution Adjudication.

The NCUA posts board meeting videos to provide transparency and to better inform people unable to attend Board meetings. An interval between the meeting and posting is necessary for the videos to comply with Section 508 of the Rehabilitation Act for the hearing and visually impaired.

The NCUA’s Board Actions webpage has detailed information about the Board’s activities—including meeting agendas, Board Action Bulletins, and Board memorandums—as well as archived meeting videos.

 

NCUA Awards $2 Million in Grants to 203 Low-income Credit Unions

ALEXANDRIA, VA. (Oct. 24, 2018) – Through consistent, bipartisan collaboration, the NCUA Board is revising the agency’s regulations to relieve the regulatory, reporting, and examination burdens of federally insured credit unions, NCUA Board Chairman J. Mark McWatters said today.

McWatters spoke to attendees of the National Federation of Community Development Credit Unions’ Annual Conference in Clearwater, Florida. During his remarks, McWatters said that his collaborative partnership with Board Member Rick Metsger has resulted in more than two dozen substantive changes to NCUA’s regulatory structure, resulting in less burdens on credit unions while enhancing access to affordable financial services, including for consumers in unbanked and underserved communities.

McWatters also announced the awarding of $2 million in Community Development Revolving Loan Fund grants to 203 low-income credit unions. These funds will be used for digital services and security programs, outreach to underserved areas, and leadership development and training for credit union staff.

Congress created the Community Development Revolving Loan Fund, which the NCUA administers, to provide grants and loans to credit unions serving low-income communities. The agency received applications from 243 credit unions for more than $2.5 million in funding requests during its 2018 grant round.

Expanding access to affordable financial services has been a priority of Chairman McWatters since he joined the NCUA Board in 2014. As Chairman, he has proposed and recommended regulatory and legislative changes that would provide new opportunities for credit unions to serve unbanked and underserved communities. 

During his remarks, McWatters also noted there continues to be strong and consistent demand for short-term, small dollar loans. A viable short-term loan program provided by credit unions could be an alternative to high-priced payday loans and a way to break the cycle of debt that traps millions of consumers, he argued. Additionally, such a loan program could be a first step in bringing the millions of unbanked and underserved populations into the credit union system, he said.

In June, the NCUA Board proposed amendments to the NCUA’s payday alternative loan regulations to provide federal credit unions with additional market-based, payday alternative loan options. Adjustments to the proposal are being considered to better meet the needs of consumers.

ALEXANDRIA, VA. (Oct. 25, 2018) – Credit unions can learn more about recent changes to the Home Mortgage Disclosure Act and other federal consumer financial protection laws and regulations during a Nov. 14 webinar hosted by the National Credit Union Administration.

Online registration for the “NCUA HMDA and Consumer Compliance Regulatory Update Webinar,” is now open (opens new window). Participants will use this link to log into the webinar and to view it on mobile devices, and they should allow pop-ups from this website. The webinar is scheduled to begin at 2 p.m. Eastern.

This webinar will cover amendments to the Home Mortgage Disclosure Act and other consumer financial protection laws made by the 2018 Economic Growth, Regulatory Relief, and Consumer Protection Act. It will also include discussions on the Bureau of Consumer Financial Protection’s Interpretive and Procedural Rule implementing the HMDA changes.

Registrants can submit questions in advance at [email protected]. The email’s subject line should read, “NCUA HMDA and Consumer Compliance Regulatory Update Webinar.” Please email technical questions about accessing the webinar to [email protected].

This webinar will be closed captioned and then archived online approximately three weeks following the live event.

The Office of Consumer Financial Protection is responsible for the NCUA’s consumer financial protection program. Within the office, the Division of Consumer Compliance Policy and Outreach is responsible for consumer financial protection compliance policy, rulemaking and outreach, fair lending examinations, and interagency coordination on consumer financial protection compliance matters.

McWatters—Investing in Fundamentals: Cybersecurity, Access, Human Capital

ALEXANDRIA, Va. (Oct. 31, 2018) – The National Credit Union Administration has awarded $2 million in grants to help 203 low-income credit unions improve digital services and security, increase outreach to underserved communities, and train employees.

“These are investments in fundamentals: protecting credit unions and their members, expanding access to affordable financial services, and building human capital,” NCUA Board Chairman J. Mark McWatters said. “In particular, helping credit unions detect and defend against cyberattacks is essential to keeping members safe and the financial system secure.”

Grant awards ranging from $1,300 to $20,000 were made to credit unions in 42 states and the District of Columbia (opens new window). Forty-four credit unions are first-time grant recipients. Twenty-eight are minority depository institutions. A total of 243 credit unions made grant requests of $2.5 million in this year’s grant round.

The NCUA made awards in three categories:

• Digital services and security: 141 grants totaling $1,251,670;
• Leadership development: 40 grants totaling $350,760; and
• Underserved outreach: 22 grants totaling $397,570.

The NCUA’s Office of Credit Union Resources and Expansion administers grant funding provided by the Community Development Revolving Loan Fund, which offers grants and loans to credit unions serving low-income communities. Since 2001, Congress has provided the NCUA with $20.8 million for these grants.

The Office of Credit Union Resources and Expansion supports low-income-designated credit unions; credit unions interested in a low-income designation; minority credit unions; credit unions seeking changes in their charters, bylaws, or fields of membership; and groups organizing to start new credit unions.

The Federal Financial Institutions Examination Council (FFIEC) members issued a joint statement alerting financial institutions to recent actions taken by the Department of Treasury’s Office of Foreign Asset Control (OFAC) under their Cyber-Related Sanctions Program and to the potential impact it may have on financial institutions’ risk-management programs.

The statement describes the issues a financial institution should consider regarding the effect of sanctions on the operations of the financial institution and the implications of the continued use of products or services provided by a sanctioned entity.

Since the program’s inception, OFAC has issued sanctions against entities that are responsible for, are complicit in, or that have engaged in, certain malicious cyber-enabled activities, and providing material and technological support to malicious cyber actors that have targeted U.S. organizations. Some sanctioned entities (opens new window) may offer services to financial institutions that operate in the United States. As a result of OFAC’s sanctions, all property and interests in property of the designated persons subject to U.S. jurisdiction are blocked, and U.S. persons are generally prohibited from engaging in transactions with them.

Financial institutions should refer to OFAC resources or the FFIEC’s Information Technology Examination Handbook (opens new window) for information on requirements and expectations regarding OFAC-related compliance and operational risk management.

Attachment: Joint Statement (opens new window)