CUNA News
  • LOG IN
  • Create Account
  • Sign Out
  • My Account
  • LOG IN
  • Create Account
  • Sign Out
  • My Account
  • Topics
    • Community Service
    • Compliance
    • Credit Union Hero
    • Credit Union Rock Star
    • Credit Union System
    • Directors
    • Human Resources
    • Leadership
    • Lending
    • Marketing
    • Operations
    • Policy & Issues
    • Sales & Service
    • Technology
  • Credit Union Magazine
    • Buyers' Guide
    • COVID-19
    • Digital Edition
    • Credit Union Hero
    • Credit Union Rock Star
    • Subscribe
    • Advertise
    • Contact
  • Advertise
  • Awards
    • Nominate Credit Union Hero
    • Nominate Credit Union Rock Star
  • Podcasts
  • Videos
  • Contact

News

Home » NCUA issues letter on subordinated debt rule effective Jan. 1
Policy & Issues

NCUA issues letter on subordinated debt rule effective Jan. 1

November 8, 2021
NCUALogo

NCUA issued a Letter to Credit Unions (21-CU-13) reminding all federally insured credit unions the final subordinated debt rule becomes effective Jan. 1, 2022. The final rule amends various parts of the NCUA’s regulations to permit low-income designated credit unions, complex credit unions, and new credit unions to issue subordinated debt for purposes of regulatory capital treatment.

Any issuances of secondary capital not completed by January 1, 2022, will be subject to the requirements of the final rule, with one potential exception discussed below. Any low-income designated credit union that does not complete its secondary capital issuance by the above mentioned date will be required to be approved under the final rule, if such low-income credit union seeks to issue subordinated debt, per the letter. 

The NCUA board proposed an amendment to the subordinated debt rule at its September meeting that would allow low-income designated credit unions to issue secondary capital approved in 2021, irrespective of the date of issuance, provided such issuances are to the United States government or one of its subdivisions.

CUNA supported this proposal in its comments. According to NCUA, the board will consider a final version of this proposal before Jan. 1, 2022.

"Given the current 45-day review period for secondary capital plans, any low-income credit union still planning to submit a secondary capital plan should do so as soon as possible. Further, if a low-income designated credit union plans to submit a secondary capital plan this year, it should consider using the application requirements in section 702.408 of the final subordinated debt rule when drafting its plan and submitting an application," NCUA's letter reads. "This can help avoid having to resubmit documentation as long as the application meets the requirements of the final rule."

KEYWORDS NCUA
Credit Union Magazine: Spring 2022

Spring 2022

Credit Union Magazine’s Spring 2022 edition profiles four Credit Union Heroes and examines CUNA's advocacy priorities, the advocacy army, and financial well-being for all.
Digital Edition •  Subscribe

Trending

  • House passes CUNA-backed fair hiring bill

  • House committee to mark up field of membership modernization bill

  • Final flood Q&As reflect CUNA-sought clarifications

Tweets by CUNA_News

Polls

Are you ready for CECL?

View Results
More

Champion for the Credit Union Movement

Credit Union National Association is the most influential financial services trade association and the only national association that advocates on behalf of all of America's credit unions. We work tirelessly to protect your best interests in Washington and all 50 states. We fuel your professional growth at every level and champion the credit union story at every turn.

More CUNA

  • Membership
  • Contact Us
  • Careers

Resources for

  • Credit Union Advocates
  • Leagues
  • Press
  • Providers

Our Affiliates

  • American Association of Credit Union Leagues (AACUL)
  • Credit Union Awareness
  • Credit Union House
  • CUNA Strategic Services
  • National Credit Union Foundation
GET CUNA UPDATES
© 2022 Credit Union National Association | ADA Compliance Notice & Legal
Email Us