ALEXANDRIA, Va. (6/11/14)--Federally insured credit unions investing in or lending to a credit union service organization (CUSO) must amend the contractual agreement by the end of this month, in accordance with the new CUSO rule from the National Credit Union Administration.
The NCUA sent a Letter to Credit Unions (14-CU-07) reminding them of the new rule, which will take effect June 30.
The NCUA also has posted a May 29 clarification of a provision in its CUSO regulation. Specifically, the agency clarified for a law firm that a federally insured credit union receiving products or services from a CUSO is not required to enter into a written agreement in which the CUSO is obligated to submit an annual report to the NCUA if the credit union does not have an investment in or loan outstanding to the CUSO.
The NCUA changed its CUSO rule last November. It now requires any federally insured credit union that has an outstanding loan to, or an investment in a CUSO, to enter into a written agreement requiring the CUSO to submit annual reports to the NCUA, as well as a state supervisory authority if the credit union is state-chartered.
A federally insured credit union that only receives products or services from a CUSO is not subject to the new requirement.
According to the NCUA, the "intent of this change is to permit NCUA to obtain financial information directly from each CUSO, rather than through each credit union."
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