Board Action Bulletin
National Credit Union Share Insurance Fund report
NCUA’s Chief Financial Officer reported the Fund’s reserve balance totaled $726.1 million
February 28, 2010, with $1.5 million charged to insurance loss expense thus far in 2010.
February 2010 ended with an NCUSIF equity ratio of 1.23 percent based on the amount of
shares held by the nation’s federally insured credit unions at year-end 2009. Once credit
unions are billed for their 1 percent capitalization deposit adjustment, due in April, the equity
ratio will rise to 1.26 percent.
Six federally insured credit unions have failed thus far in 2010 at a cost to the Fund of $6.7
million -- 4 were involuntary liquidations and 2 were assisted mergers.
There were 337 CAMEL code 4&5 credit unions at February 28, 2010; 20 fewer than were
reported last month.
The current distribution of federally insured credit union assets by CAMEL code follows:
81.37 percent of assets are held in CAMEL code 1&2 credit unions;
13.25 percent of assets are in CAMEL code 3 credit unions; and
5.38 percent of assets are held in CAMEL code 4&5 credit unions.
Through February, NCUSIF’s annual revenue and expenses included total income of $42.7
million, total expenses of $23.2 million, resulting in net income of $19.5 million.
During February, the Temporary Corporate Credit Union Stabilization Fund made a payment
of $310 million on the $1 billion note payable to the U.S. Treasury.
Proposal establishes federal credit union director duties, clarifies
merger and conversion requirements
The NCUA Board issued a proposed rulemaking, with a 60-day comment period, that
addresses several related areas affecting federal credit union operations, and it acts to protect
member rights. The proposal documents and clarifies the fiduciary duties and responsibilities
of federal credit union directors. It also adds new provisions establishing procedures for
insured credit unions merging into banks, and it would amend some existing regulatory
procedures related to insured credit unions merging with other credit unions and converting to
Following-up on issues addressed in an Advance Notice of Proposed Rulemaking (ANPR)
issued in 2008, the proposed rulemaking includes a new §701.4, which defines the general
authorities as well as management and fiduciary duties of federal credit union directors. This
section responds to the need to provide federal credit union directors with uniform standards.
Revisions to Part 708a address credit union conversions to mutual savings banks and credit
union mergers into banks. Proposed Part 708a would better protect the secrecy and integrity of
the voting process during conversion to a mutual savings bank by providing members with
additional information about how the conversion could affect them, and it requires converting
credit unions to provide copies of correspondence with other agencies related to the
The proposed rule would define and standardize procedures for credit union mergers into
banks. Based on NCUA’s right and responsibility to regulate both the procedures and basic
aspects of a credit union’s merger into a bank, the regulation would establish the procedures
and requirements for obtaining approval of the NCUA Board and credit union members.
Proposed Part 708b revisions address credit union mergers with other credit unions and
termination or conversion of NCUA federal deposit insurance status. The proposal adds
balloting and procedure requirements to protect the integrity of the vote and ensure full and
accurate disclosure to the members and to NCUA.
2011-2016 Strategic Plan presented to public
The NCUA Board heard a briefing on the NCUA Strategic Plan 2011–2016. The plan focuses
on ensuring and maintaining confidence in a dynamic, safe and sound credit union system.
The plan was developed around four main objectives that include:
Provide a broad, general, transparent roadmap of program and support operations;
Encourage an innovative, flexible regulatory environment that increases access to financial services for all those eligible for credit union service;
Increase alignment between essential mission functions and long-term strategic goals; and
Align well-trained staff with existing resources and emerging issues.
The NCUA Strategic Plan 2011–2016 was issued with a 60-day public comment period.
Safety & soundness revisions proposed for RegFlex
The NCUA Board approved, by a 2 to 1 vote, proposed rule revisions to NCUA’s Regulatory
Flexibility Program to enhance safety and soundness for credit unions and adjust to the decline
in the economy.
Amending Parts 701, 723 and 742, the proposal would revise RegFlex provisions affecting
fixed assets, member business loans (MBLs), stress testing of investments, and discretionary
control of investments. Some of these revisions will require conforming amendments to
NCUA’s fixed assets and MBL rules. The proposal was issued with a 60-day comment period.
The NCUA tweets all open Board meetings live. Follow
@TheNCUA on Twitter, and access Board Action Memorandums and NCUA rule changes at
www.ncua.gov. The NCUA also live streams, archives and posts
videos of open Board meetings online.
NCUA is the independent federal agency created by the U.S. Congress to regulate, charter and supervise federal credit unions. With the backing of the full faith and credit of the United States, NCUA operates and manages the National Credit Union Share
Insurance Fund, insuring the deposits of account holders in all federal credit unions and the overwhelming majority of
state-chartered credit unions. At MyCreditUnion.gov, NCUA also educates the public on consumer protection and financial literacy issues.