Dear Mr. Robey:
You have asked what actions are sufficient to meet a requirement in the fixed asset rule
stating federal credit unions (FCUs) must “publicly advertise” property for sale after it
has been “abandoned” for four years. 12 C.F.R. §701.36(b)(3). Specifically, you have asked
if it is sufficient if an FCU lists the property for sale with a real estate broker who
posts a “for sale” sign in front of the property and uses other means of offering the
property for sale. We conclude this will generally be sufficient to meet the regulatory
requirement, assuming the other means include using a commercial listing service.
Generally, the fixed asset rule limits FCU investment in fixed assets and, among other
provisions, requires FCUs to dispose of abandoned property. 12 C.F.R. §§701.36(a),
701.36(b)(2). Abandoned property means real property an FCU is no longer using and
includes real property an FCU originally acquired for future expansion but which an
FCU no longer intends to use. 12 C.F.R. 701.36(e)(1). The rule states, if the property
has been abandoned for four years, an FCU must publicly advertise it. 12 C.F.R. §701.36(b)(3).
Our view is listing the property with a real estate agent, which we assume means the property
will be included in a commercial listing service, and posting a “for sale” sign in front of
the property generally should be sufficient to satisfy the regulatory requirement. The rule
requires FCUs to make diligent efforts to dispose of and seek fair market value for abandoned
property, which may require additional actions than described here depending on location and
circumstances, and an FCU needs to be mindful the rule requires sale of abandoned property within
five years unless NCUA provides written approval. Id.
If you have any further questions, please contact Staff Attorney Justin Anderson or me.