Central Liquidity Facility Membership Frequently Asked Questions

What type of liquidity needs can the CLF fund?

Credit unions that are members of the CLF can borrow funds for short-term, seasonal, and protracted adjustment liquidity needs. Historically, the CLF has focused on providing short-term collateralized loans to safe and sound natural person credit unions

  • Short-term adjustment credits — Available to help a credit union meet temporary requirements for funds or to cushion more persistent outflows of funds, pending an orderly adjustment of credit union assets and liabilities. These advances are typically made for 90 days, but are available for periods up to one year.
  • Seasonal credits — Available for longer periods to help a credit union meet seasonal needs for funds that arise from a combination of expected patterns of movement in share and deposit accounts and loans. Season credit advances are generally available for periods of up to 270 days.
  • Protracted adjustment credits — Available in the event of unusual or emergency circumstances of a longer-term nature resulting from national, regional, or local difficulties. The terms for these advances vary.

Which credit unions can join the CLF?

All natural person credit unions and corporate credit unions are eligible to join the CLF. Membership in the CLF is voluntary, and open to any eligible credit union that buys a prescribed amount of CLF stock. There is no membership fee to join.

How much can a credit union borrow from the CLF?

A member credit union can request any amount of funding it needs, up to its legal borrowing limit.

Can a credit union establish a line of credit with the CLF?

The CLF only grants fixed term loans at a fixed rate, and does not grant lines of credit.

How does a credit union become a member of the CLF?

To become a member, a credit union must complete an application (pdf) and purchase capital stock of the CLF. Part 725 of NCUA’s Rules and Regulations established the amount of stock a member must maintain to have borrowing privileges.

To apply for CLF membership, submit an original, signed application (pdf) and copies of the required documents to the NCUA Central Liquidity Facility at 1775 Duke Street in Alexandria, VA 22314.To complete an application, a credit union must wire the money to CLF. You can contact the CLF at CLFMail@NCUA.gov to confirm that the calculated stock subscription amount to be remitted is accurate and to request wiring instructions.

When a credit union is accepted into the CLF, it will receive a welcome letter and the original signed copy of the Repayment, Security and Credit Reporting Agreement (Appendix C-2).For more information about the application process, see How to Apply for Regular CLF Membership - A Brief Overview (pdf), or contact the CLF directly at 703.518.6428.

How can I calculate the amount of stock we need to maintain?

The amount of stock a member must purchase is calculated based on a percentage (one half of one percent) of the credit union’s paid-in and unimpaired capital and surplus. Members must transfer half of the funds required, based on the calculation above, to the CLF.

The remaining half of the required funds are placed on-call, which helps increase the credit union’s liquidity, and reduces the burden of joining the CLF. Members retain the remaining half of the required funds on call by investing them in liquid assets. These funds must remain available on call by the NCUA Board.

The number of new member shares and the amount due to subscribe is calculated using a six month arithmetic average of paid-in and unimpaired capital surplus based on your credit union’s most recent Call Reports.

How often does the CLF adjust the required stock amounts?

The CLF adjusts member capital stock amounts annually to reflect any changes in a credit union’s total paid-in and unimpaired capital and surplus. If a credit union needs to purchase more paid-in capital stock than the amount currently on deposit, the CLF will first draw from its Liquidity Reserve and Clearing (LRC) account. Credit unions can send any remaining balance that is due by check or wire transfer.

If the amount of paid-in capital stock decreases from the previous year, the CLF will send the excess funds directly to the member.

What is the timing for the annual CLF required stock adjustments?

The capital stock subscriptions are adjusted after the audited close of each calendar year. Generally, the annual adjustment process begins in March and the statements are subsequently mailed to the members.

How long does it take to process a new member application?

It typically takes one to two weeks to process a new member application once we receive an application. Once your application has been processed, you will receive an acceptance letter and an executed copy of the “NCUA Central Liquidity Facility Repayment, Security and Credit Reporting Agreement” (Appendix C-2).

How do I account for CLF membership?

The stock subscription is categorized as an investment on your Call Report as shown below.

Investment  Weighted Average Life for Prompt Correct Action, Risk-based Net Worth Calculation
Capital in mixed-ownership government corporations and corporate credit unions, including CLF and Federal Home Loan Bank stock. Greater than one year, but less than or equal to three years.


Is my investment in CLF stock insured?

While your stock investment in CLF will not be insured, it is important to note that the CLF is a mixed-ownership government corporation, and operates with the backing of the full faith and credit of the U.S. government. Title III of the Federal Credit Union Act sets forth the powers of the CLF and the terms and conditions of membership.

Members who invest in CLF stock will not lose any money. The Federal Credit Union Act holds that a member can redeem membership capital after giving notice to the CLF, and that “when circumstances require that all or a portion of a member’s stock be redeemed,” the Board will pay an amount equal to what the member originally paid for the stock, minus any amount owed by the member to the CLF (see 12 USC 1795(d)(c)).

Does the CLF pay dividends on capital stock? Is interest paid?

All capital stock in CLF is common shares. CLF pays a quarterly dividend on paid-in capital stock.

Dividend Rates by Quarter, 2013–2018 (in percent)

Quarter 2018 2017 2016 2015 2014 2013
Dividend Rate First Quarter  1.00 0.75 0.25 0.25 0.25 0.10
Dividend Rate Second Quarter 1.25 0.75 0.50 0.25 0.24 0.10
Dividend Rate Third Quarter 1.25 1.00 0.50 0.25 0.25 0.10
Dividend Rate Fourth Quarter N/A 1.00 0.50 0.25 0.25 0.10


Dividends will be paid into your Liquidity Reserve and Clearing (LRC) account after the end of each quarter. Both your main capital stock subscription and LRC account balances are shown on your Quarterly Statement of Accounts. The LRC accounts are member deposits, which represent amounts remitted by members over and above the amount required for membership or deposited there on their behalf. CLF pays interest on member deposits at a rate equivalent to the dividend rate paid on required capital stock. The CLF pays out LRC balances annually after the annual capital stock adjustment period.

How can a credit union end its membership in CLF?

Member credit unions must notify the NCUA Board of their intention to end their membership. The timeframe required for this notification varies based on the amount of capital stock a member holds at the time of the decision to end the membership:

A member whose capital stock subscription constitutes less than five percent of the total CLF stock held by all shareholders can end CLF membership six months after notifying the NCUA Board of its intention to do so. Refunds are processed immediately thereafter.

A member whose capital stock subscription constitutes five percent or more of the total CLF stock held by all shareholders can end CLF membership 24 months after notifying the NCUA Board of its intention to do so. Refunds are processed immediately thereafter.

How do I conduct advance planning and periodic testing to ensure my contingent federal liquidity source is readily available when needed?

Unlike the Federal Reserve Discount Window, the CLF does not provide a line of credit, and does not “test the line.” For the CLF, a credit union is not permitted to conduct a test loan transaction. However, the CLF can conduct a test transfer of funds between itself and members to verify the correctness of the delivery instructions of record — the same wire instructions used for actual liquidity advance requests. This test will satisfy the regulatory requirement for “periodic testing to ensure contingent funding sources are readily available as needed” pursuant to §741.12(c).

Where can I find more information about the CLF?

You can find more information and monthly CLF reports on the Central Liquidity Facility page of the NCUA website. You can also contact the CLF directly for more information:

National Credit Union Administration 
Central Liquidity Facility
1775 Duke Street
Alexandria, VA 22314 
Email: CLFMail@NCUA.gov 
Phone: 703.518.6428