ALEXANDRIA, Va. (5/27/15)--Questions that credit unions have regarding the National Credit Union Administration’s April 2014 supervisory guidance on taxi medallion lending are answered in a new document sent to federally insured credit unions by the agency.
In the new Letter to Credit Unions (15-CU-03), NCUA Chair Debbie Matz said the agency has received numerous questions regarding topics such as financial reporting, methods for valuing taxi medallions and influences on a medallion’s value as collateral.
The April 2014 letter did not impose any new requirements on taxi medallion lending. Credit unions are required to analyze and document the ability of the borrower to repay the loan consistent with standard underwriting and due diligence standards.
Borrowers can range from simple operating structures with a single operator to interdependent entities owning multiple medallions with a complex income structure where the borrower is dependent on lease payments from similar entities.
Questions addressed in the new document include:
Matz encourages all federally insured credit unions with questions on this issue to contact their regional office or state supervisory authority.