NCUA Board Meets, Approves Two New Rules and Delivers Quarterly NCUSIF Report (Misc News: February 25, 2013)
The NCUA board last week approved two pending rules, one amending the definition of a "rural district" and the other allowing credit unions to invest in Treasury Inflation Protected Securities.
At its meeting on Feb. 21, the NCUA board met and approved a rule, supported by MCUL & Affiliates, amending the definition of "rural district" in the NCUA Chartering and Field of Membership Manual. An area would qualify as a rural district if it has 250,000 or less in population or less than 3% of the state's population. Additionally, the rural district still must have well-defined contiguous boundaries and either have more than 50% of its population in rural areas or have a population density of no more than 100 people per square mile.
The board also approved a pending rule to allow credit unions to invest in TIPS. TIPS provide another investment portfolio risk management tool that can be used in an inflationary economic environment.
The board also discussed the quarterly National Credit Union Share Insurance Fund report, which reflected the generally positive economic trends that credit unions around the country have experienced, with an overall decline in credit unions rated CAMEL 3 or below, and CAMEL 4 and 5 credit unions representing only 2.02% of insured shares nationwide.
For 2012, the total net position of the Temporary Corporate Credit Union Stabilization Fund improved by nearly $1.8 billion. When the fund has outstanding borrowings from the U.S. Treasury, the agency must make a distribution from the share insurance fund, if the share insurance fund has an equity ratio that is more than 1.30% at year’s end. As this was the case in December 2012, NCUA transferred $88.1 million to fund, which will reduce its future cash needs.