NCUA sets 2023 NOL at 1.33%, approves budget lower than proposed
The NCUA Board issued a proposal regarding the purchase of loan participations and set the 2023 Normal Operating Level at 1.33% (same as 2022) at its Dec. 15 meeting. The board also approved the agency’s budget for 2023, a 6.2% increase over 2022, but less than proposed budget from October.
The loan participation proposal would amend the NCUA’s rules regarding the purchase of loan participations and the purchase, sale, and pledge of eligible obligations and other loans. It is intended to clarify the current regulations and provide additional flexibility for credit unions to make use of advanced technologies and opportunities offered by the fintech sector.
The proposal would also make conforming amendments to the rule regarding loans to members and lines of credit to members by adding new provisions about indirect lending arrangements and indirect leasing arrangements.
Comments on the proposal are due within 60 days after its publication in the Federal Register.
The board heard a briefing on the NOL, and set it at 1.33% for 2023, a level set by the board originally in December 2021.
The board also approved the 2023-24 budget, which is a 6.2% increase over the 2022 budget. CUNA, Leagues, and others raised concerns over the budget originally proposed, which was an increase of 9.6% in October. This is due in large part to seven fewer positions from the proposed budget, as well as a larger than expected surplus from 2022.
As part of approving the final 2023-24 budget, the board also approved a $15 million credit against the 2023 Operating Fee, reducing by approximately 17 percentage points the amounts that would otherwise be due from credit unions that pay the fee.
Average fees paid by federal credit unions will decline in 2023 by approximately 1.8%, according to NCUA.
Additional details on the meeting can be found at CUNA’s Removing Barriers Blog.