ALEXANDRIA, Va. (3/15/13)--The National Credit Union Administration voted to seek comments on a proposal that clarifies and reorganizes portions of its rule addressing federal credit union ownership of fixed assets during a swift March open board meeting.
|NCUA Chairman Debbie Matz, center-right, Board Member Michael Fryzel, center-left, and agency staff share a light moment before a less-than-lengthy NCUA open board meeting on Thursday. The meeting took around 20 minutes to complete. (CUNA Photo)|
The NCUA's current fixed assets rule, Section 701.36, allows federal credit unions to purchase, hold and dispose of property necessary or incidental to their operations. These fixed assets include office buildings, branch facilities, furniture, computer hardware and software, and ATMs.
The proposal is not intended to impose new requirements on credit unions. It revamps portions of the rule to use more plain language, reorganizes certain definitions, and adds a new introduction to define the scope and application of the regulation. The proposal also clarifies the processes for obtaining regulatory waivers from the rule. New definitions for the terms "partially occupy" and "unimproved land or unimproved property" have also been added, the NCUA said.
NCUA Chairman Debbie Matz credited board member Michael Fryzel with first suggesting that the agency could simplify the regulation into plain English. She said the NCUA will look for ways to treat other existing regulations in a similar fashion as the agency moves forward with its regulatory modernization initiative.
"By reorganizing the rule, adding definitions and using the principles of plain writing, we're making it easier for credit unions to follow the rule," Matz said.
Comments on the proposal will be due 60 days after the plan is published in the Federal Register.
Credit Union National Assocition Deputy General Counsel Mary Dunn said "CUNA will be using this opportunity to review the rule in detail and provide broad comments."
The NCUA also voted to approve a community charter conversion request from Cinfed FCU, Cincinnati, Ohio. That multiple common-bond chartered credit union was established in 1934, and holds $312.9 million in assets. Cinfed has 29,791 members, representing nearly 75% of the credit union's potential membership base. The charter expansion will allow the credit union to serve residents of Boone, Campbell and Kenton counties in Kentucky and Hamilton County in Ohio. This expands the credit union's potential field of membership to 1,171,241, the agency said.
Matz acknowledged Cinfed for putting a great deal of thought into their charter change proposal. The credit union plans to diversify its membership, increase earnings and reach into the Latin American community with outreach activities and potentially a Spanish-language version of its website. The credit union also plans to work extensively with underserved populations by offering low-deposit checking accounts, credit rebuilder loans, and rate reductions for members once they establish payment history, the NCUA said.
For more on the meeting, use the resource links.