General Lending Maturity Limit and Other Financial Services, 7927-7928 [E7-2902]
Download as PDF
<![CDATA[
Federal Register / Vol. 72, No. 35 / Thursday, February 22, 2007 / Rules and Regulations
FARM CREDIT ADMINISTRATION
NATIONAL CREDIT UNION
ADMINISTRATION
12 CFR Parts 611, 619, 620, 621, 624,
627, and 630
12 CFR Part 701
RIN 3133–AD30
RIN 3052–AC11
Organization; Definitions; Disclosure
to Shareholders; Accounting and
Reporting Requirements; Regulatory
Accounting Practices; Title IV
Conservators, Receivers, and
Voluntary Liquidations; and Disclosure
to Investors in System-Wide and
Consolidated Bank Debt Obligations of
the Farm Credit System; Effective Date
AGENCY:
ACTION:
Farm Credit Administration.
Notice of effective date.
SUMMARY: The Farm Credit
Administration (FCA) published a final
rule under parts 611, 619, 620, 621, 624,
627, and 630 on December 20, 2006 (71
FR 76111). This final rule amends our
disclosure and reporting regulations for
Farm Credit System (System)
institutions by clarifying and enhancing
existing disclosures and reporting to
System shareholders and investors. In
accordance with 12 U.S.C. 2252, the
effective date of the final rule is 30 days
from the date of publication in the
Federal Register during which either or
both Houses of Congress are in session.
Based on the records of the sessions of
Congress, the effective date of the
regulations is February 16, 2007.
The regulation
amending 12 CFR parts 611, 619, 620,
621, 624, 627, and 630, published on
December 20, 2006 (71 FR 76111) is
effective February 16, 2007.
EFFECTIVE DATES:
FOR FURTHER INFORMATION CONTACT:
Thomas Dalton, Senior Staff
Accountant, Office of Policy and
Analysis, Farm Credit Administration,
McLean, VA 22102–5090, (703) 883–
4414, TTY (703) 883–4434;
or
Laura McFarland, Senior Attorney,
Office of General Counsel, Farm
Credit Administration, McLean, VA
22102–5090, (703) 883–4020, TTY
(703) 883–4020.
erjones on PRODPC74 with RULES
(12 U.S.C. 2252(a)(9) and (10))
Dated: February 16, 2007.
Roland E. Smith,
Secretary Farm Credit Administration Board.
[FR Doc. E7–3055 Filed 2–21–07; 8:45 am]
BILLING CODE 6705–01–P
VerDate Aug<31>2005
13:25 Feb 21, 2007
Jkt 211001
General Lending Maturity Limit and
Other Financial Services
National Credit Union
Administration (NCUA).
ACTION: Final rule.
AGENCY:
SUMMARY: NCUA is amending its rules
to implement amendments to the
Federal Credit Union Act (FCU Act)
made by the Financial Services
Regulatory Relief Act of 2006 (Reg Relief
Act). The final rule revises the maturity
limit in the general lending rule and
permits federal credit unions to provide
certain, limited financial services to
nonmembers within their fields of
membership.
This final rule is effective March
26, 2007.
FOR FURTHER INFORMATION CONTACT:
Moisette Green, Staff Attorney, Office of
General Counsel, at the above address or
telephone: (703) 518–6540.
SUPPLEMENTARY INFORMATION:
DATES:
A. Background
In October 2006, Congress enacted the
Reg Relief Act, which amended the
general lending maturity limit for
federal credit unions (FCUs) from 12
years to 15 years in § 107(5) of the FCU
Act as well as § 107(12) of the FCU Act
to permit FCUs to provide certain
financial services to persons within
their fields of membership. Pub. L. 109–
351, §§ 502–503, 120 Stat. 1966 (2006).
On October 19, 2006, the NCUA Board
issued an interim final rule to
implement these provisions of the Reg
Relief Act. 71 FR 62875 (October 27,
2006). Even though the provisions of the
interim final rule became effective on
October 27, 2006, the Board issued the
interim final rule with a 60-day
comment period.
B. The Final Rule
NCUA received eight comments on
the interim final rule from federal credit
unions and trade associations. All the
commenters supported the interim final
rule, and some provided additional
comments. Two commenters
encouraged NCUA to seek a longer
maturity limit for loans on investment
property. While the NCUA Board
generally supports greater flexibility for
permissible terms for investment loans,
the suggestion is beyond the scope of
NCUA’s statutory authority and the
interim rulemaking.
PO 00000
Frm 00005
Fmt 4700
Sfmt 4700
7927
Four commenters requested
clarification on whether FCUs may
charge a fee for selling negotiable
checks, travelers checks, money orders,
and other similar money transfer
instruments under § 701.30(a). Two
commenters pointed out that § 701.30(b)
specifically permits FCUs to charge a fee
for cashing negotiable or money transfer
instruments.
FCUs may charge a fee for ‘‘selling’’
money transfer instruments, and
specifically providing that FCUs may
charge a fee for ‘‘cashing’’ money
transfer instruments does not limit that
authority. The Reg Relief Act does not
restrict the terms under which an FCU
can sell negotiable instruments to a
person within its field of membership,
and the legislative history does not
indicate that Congress intended the
provision to have any special meaning.
Therefore, the common understanding
and meaning of the term ‘‘sell’’ in § 503
of the Reg Relief Act and § 701.30(a) of
the rule apply. Selling, by definition,
involves the transfer of goods or
rendering services for a price. See,
Random House Unabridged Dictionary
1739 (2d ed. 1993). Contrary to selling
a money transfer instrument, ‘‘cashing’’
an instrument involves the exchange of
the instrument for money in the amount
reflected on the face of the instrument,
and the term does not necessarily mean
a fee for the service is permitted. FCUs
have always had authority to cash a
check drawn on a member’s account
regardless of the payee’s membership
status as this is a service to the memberdrawer; the Reg Relief Act permits FCUs
to cash a check payable to a nonmember
within their field of membership even if
the drawer is not a member. The
specific provision in the Reg Relief Act
and the rule to charge a fee for this
exchange permits FCUs to collect a
payment for providing the check
cashing service. Additionally, FCUs are
not required to charge persons for
financial services under section 503 of
the Reg Relief Act or the rule, but ‘‘may’’
sell or charge a fee for them.
Three commenters suggested NCUA
define the term ‘‘electronic funds
transfer.’’ The commenters stated the
interim final rule was unclear on
whether the term ‘‘electronic funds
transfer’’ had the same definition as in
Regulation E, 12 CFR part 205, or the
term ‘‘transmittal of funds’’ under the
anti-money laundering regulations, 31
CFR part 103. The Board believes it is
unnecessary to define ‘‘electronic funds
transfer’’ in this rule for two reasons.
First, the term ‘‘electronic funds
transfer’’ is defined in the Electronic
Funds Transfer Act and Regulation E. 15
U.S.C. 1693a(6); 12 CFR 205.3. Second,
E:\FR\FM\22FER1.SGM
22FER1
erjones on PRODPC74 with RULES
7928
Federal Register / Vol. 72, No. 35 / Thursday, February 22, 2007 / Rules and Regulations
the types of money transfer instruments
permissible under § 701.30 are not
limited to electronic funds transfers.
The rule permits an FCU to cash or sell
checks, money orders, and other similar
money transfer instruments. While the
rule does not contain an exhaustive list
of permissible money transfer
instruments, it specifically includes
electronic funds transfers. To the extent
FCUs provide money transfer
instruments that fall within the
definition of electronic funds transfer
under Regulation E, they must, of
course, comply with Regulation E
requirements.
The Board notes that electronic funds
transfers under Regulation E are
excluded from the definition of
‘‘transmittal of funds’’ in the
Department of Treasury’s anti-money
laundering regulations. 31 CFR part 103.
This definition, however, does not affect
FCU authority to provide wire transfers
under § 701.30. FCUs providing wire
transfer services and electronic funds
transfers under § 701.30 must comply
with the applicable requirements of 31
CFR part 103.
Two commenters requested NCUA
provide guidance regarding FCU
compliance with other statutes and
regulations, e.g. the Bank Secrecy Act
(Pub. L. 91–508), the Customer
Identification Program regulation (31
CFR 103.121), NCUA security rules (12
CFR part 748), financial privacy rules
(12 CFR part 716), and so forth. One of
these commenters recommended NCUA
establish a working group to discuss
compliance requirements associated
with FCUs providing financial services
to nonmembers within their fields of
membership. The Board believes
additional guidance or a working group
is unnecessary because this rule does
not create any additional requirements
for FCUs than there are for other
financial institutions. The Board only
cautions FCUs to ensure they comply
with all applicable statutory or
regulatory requirements if they elect to
provide financial services to persons
with whom the FCUs may have
infrequent or irregular contact.
Finally, one commenter correctly
noted the interim final rule failed to
make a conforming change to the 12year maturity limit in the current rule
regarding due-on-sale clauses. 12 CFR
701.21(g)(6)(ii). Accordingly, the final
rule revises this reference to reflect the
change in the general lending maturity
limit to 15 years.
VerDate Aug<31>2005
13:25 Feb 21, 2007
Jkt 211001
Regulatory Procedures
Regulatory Flexibility Act
The Regulatory Flexibility Act
requires NCUA to prepare an analysis to
describe any significant economic
impact a rule may have on a substantial
number of small credit unions, defined
as those under ten million dollars in
assets. This rule clarifies and improves
the available services FCUs may provide
to their members and persons within
their fields of membership, without
imposing any regulatory burden. The
final amendments do not have a
significant economic impact on a
substantial number of small credit
unions, and, therefore, a regulatory
flexibility analysis is not required.
Paperwork Reduction Act
NCUA has determined that the final
rule would not increase paperwork
requirements under the Paperwork
Reduction Act of 1995 and regulations
of the Office of Management and
Budget. 44 U.S.C. 3501 et seq.; 5 CFR
part 1320.
Executive Order 13132
Executive Order 13132 encourages
independent regulatory agencies to
consider the impact of their actions on
state and local interests. In adherence to
fundamental federalism principles,
NCUA, an independent regulatory
agency as defined in 44 U.S.C. 3502(5),
voluntarily complies with the executive
order. The final rule would not have
substantial direct effects on the states,
on the connection between the national
government and the states, or on the
distribution of power and
responsibilities among the various
levels of government. NCUA has
determined that this rule does not
constitute a policy that has federalism
implications for purposes of the
executive order.
The Treasury and General Government
Appropriations Act, 1999—Assessment
of Federal Regulations and Policies on
Families
The NCUA has determined that this
final rule would not affect family wellbeing within the meaning of § 654 of the
Treasury and General Government
Appropriations Act, 1999, Pub. L. 105–
277, 112 Stat. 2681 (1998).
Small Business Regulatory Enforcement
Fairness Act
The Small Business Regulatory
Enforcement Fairness Act of 1996, Pub.
L. 104–121 (SBREFA), provides
generally for congressional review of
agency rules. A reporting requirement is
triggered in instances where NCUA
PO 00000
Frm 00006
Fmt 4700
Sfmt 4700
issues a final rule as defined by Section
551 of the Administrative Procedure
Act. 5 U.S.C. 551. The Office of
Management and Budget has
determined that this final rule is not a
major rule for purposes of SBREFA.
List of Subjects in 12 CFR Part 701
Check, Check cashing, Credit, Credit
unions, Electronic funds transfer,
Money order, Money transfer.
I For the reasons set forth in the
preamble, the Board amends 12 CFR
part 701 as set forth below.
By the National Credit Union
Administration Board on February 15, 2007.
Mary F. Rupp,
Secretary of the Board.
Accordingly, the interim rule
amending 12 CFR part 701, which was
published at 71 FR 62875 on October
27, 2006, is adopted as a final rule with
the following change:
I
PART 701—ORGANIZATION AND
OPERATION OF FEDERAL CREDIT
UNIONS
1. The authority citation for part 701
continues to read as follows:
I
Authority: 12 U.S.C. 1752(5), 1757, 1765,
1766, 1781, 1782, 1787, 1789; Title V, Pub.
L. 109–351; 120 Stat. 1966.
2. Amend Section 701.21 by removing
‘‘greater than twelve years’’ in the first
sentence and adding in its place
‘‘greater than fifteen years’’ in paragraph
(g)(6)(ii).
I
[FR Doc. E7–2902 Filed 2–21–07; 8:45 am]
BILLING CODE 7535–01–P
DEPARTMENT OF TRANSPORTATION
Federal Aviation Administration
14 CFR Part 71
[Docket No. FAA–2006–25941; Airspace
Docket No. 06–ACE–11]
Modification of Class E Airspace;
Creston, IA
Federal Aviation
Administration (FAA), DOT.
ACTION: Direct final rule; confirmation of
effective date.
AGENCY:
SUMMARY: This document confirms the
effective date of the direct final rule
which revises Class E airspace at
Creston, IA.
EFFECTIVE DATE: 0901 UTC, March 15,
2007.
FOR FURTHER INFORMATION CONTACT:
Grant Nichols, System Support, DOT
E:\FR\FM\22FER1.SGM
22FER1
]]>Agencies
[Federal Register Volume 72, Number 35 (Thursday, February 22, 2007)]
[Rules and Regulations]
[Pages 7927-7928]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-2902]
-----------------------------------------------------------------------
NATIONAL CREDIT UNION ADMINISTRATION
12 CFR Part 701
RIN 3133-AD30
General Lending Maturity Limit and Other Financial Services
AGENCY: National Credit Union Administration (NCUA).
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: NCUA is amending its rules to implement amendments to the
Federal Credit Union Act (FCU Act) made by the Financial Services
Regulatory Relief Act of 2006 (Reg Relief Act). The final rule revises
the maturity limit in the general lending rule and permits federal
credit unions to provide certain, limited financial services to
nonmembers within their fields of membership.
DATES: This final rule is effective March 26, 2007.
FOR FURTHER INFORMATION CONTACT: Moisette Green, Staff Attorney, Office
of General Counsel, at the above address or telephone: (703) 518-6540.
SUPPLEMENTARY INFORMATION:
A. Background
In October 2006, Congress enacted the Reg Relief Act, which amended
the general lending maturity limit for federal credit unions (FCUs)
from 12 years to 15 years in Sec. 107(5) of the FCU Act as well as
Sec. 107(12) of the FCU Act to permit FCUs to provide certain
financial services to persons within their fields of membership. Pub.
L. 109-351, Sec. Sec. 502-503, 120 Stat. 1966 (2006). On October 19,
2006, the NCUA Board issued an interim final rule to implement these
provisions of the Reg Relief Act. 71 FR 62875 (October 27, 2006). Even
though the provisions of the interim final rule became effective on
October 27, 2006, the Board issued the interim final rule with a 60-day
comment period.
B. The Final Rule
NCUA received eight comments on the interim final rule from federal
credit unions and trade associations. All the commenters supported the
interim final rule, and some provided additional comments. Two
commenters encouraged NCUA to seek a longer maturity limit for loans on
investment property. While the NCUA Board generally supports greater
flexibility for permissible terms for investment loans, the suggestion
is beyond the scope of NCUA's statutory authority and the interim
rulemaking.
Four commenters requested clarification on whether FCUs may charge
a fee for selling negotiable checks, travelers checks, money orders,
and other similar money transfer instruments under Sec. 701.30(a). Two
commenters pointed out that Sec. 701.30(b) specifically permits FCUs
to charge a fee for cashing negotiable or money transfer instruments.
FCUs may charge a fee for ``selling'' money transfer instruments,
and specifically providing that FCUs may charge a fee for ``cashing''
money transfer instruments does not limit that authority. The Reg
Relief Act does not restrict the terms under which an FCU can sell
negotiable instruments to a person within its field of membership, and
the legislative history does not indicate that Congress intended the
provision to have any special meaning. Therefore, the common
understanding and meaning of the term ``sell'' in Sec. 503 of the Reg
Relief Act and Sec. 701.30(a) of the rule apply. Selling, by
definition, involves the transfer of goods or rendering services for a
price. See, Random House Unabridged Dictionary 1739 (2d ed. 1993).
Contrary to selling a money transfer instrument, ``cashing'' an
instrument involves the exchange of the instrument for money in the
amount reflected on the face of the instrument, and the term does not
necessarily mean a fee for the service is permitted. FCUs have always
had authority to cash a check drawn on a member's account regardless of
the payee's membership status as this is a service to the member-
drawer; the Reg Relief Act permits FCUs to cash a check payable to a
nonmember within their field of membership even if the drawer is not a
member. The specific provision in the Reg Relief Act and the rule to
charge a fee for this exchange permits FCUs to collect a payment for
providing the check cashing service. Additionally, FCUs are not
required to charge persons for financial services under section 503 of
the Reg Relief Act or the rule, but ``may'' sell or charge a fee for
them.
Three commenters suggested NCUA define the term ``electronic funds
transfer.'' The commenters stated the interim final rule was unclear on
whether the term ``electronic funds transfer'' had the same definition
as in Regulation E, 12 CFR part 205, or the term ``transmittal of
funds'' under the anti-money laundering regulations, 31 CFR part 103.
The Board believes it is unnecessary to define ``electronic funds
transfer'' in this rule for two reasons. First, the term ``electronic
funds transfer'' is defined in the Electronic Funds Transfer Act and
Regulation E. 15 U.S.C. 1693a(6); 12 CFR 205.3. Second,
[[Page 7928]]
the types of money transfer instruments permissible under Sec. 701.30
are not limited to electronic funds transfers. The rule permits an FCU
to cash or sell checks, money orders, and other similar money transfer
instruments. While the rule does not contain an exhaustive list of
permissible money transfer instruments, it specifically includes
electronic funds transfers. To the extent FCUs provide money transfer
instruments that fall within the definition of electronic funds
transfer under Regulation E, they must, of course, comply with
Regulation E requirements.
The Board notes that electronic funds transfers under Regulation E
are excluded from the definition of ``transmittal of funds'' in the
Department of Treasury's anti-money laundering regulations. 31 CFR part
103. This definition, however, does not affect FCU authority to provide
wire transfers under Sec. 701.30. FCUs providing wire transfer
services and electronic funds transfers under Sec. 701.30 must comply
with the applicable requirements of 31 CFR part 103.
Two commenters requested NCUA provide guidance regarding FCU
compliance with other statutes and regulations, e.g. the Bank Secrecy
Act (Pub. L. 91-508), the Customer Identification Program regulation
(31 CFR 103.121), NCUA security rules (12 CFR part 748), financial
privacy rules (12 CFR part 716), and so forth. One of these commenters
recommended NCUA establish a working group to discuss compliance
requirements associated with FCUs providing financial services to
nonmembers within their fields of membership. The Board believes
additional guidance or a working group is unnecessary because this rule
does not create any additional requirements for FCUs than there are for
other financial institutions. The Board only cautions FCUs to ensure
they comply with all applicable statutory or regulatory requirements if
they elect to provide financial services to persons with whom the FCUs
may have infrequent or irregular contact.
Finally, one commenter correctly noted the interim final rule
failed to make a conforming change to the 12-year maturity limit in the
current rule regarding due-on-sale clauses. 12 CFR 701.21(g)(6)(ii).
Accordingly, the final rule revises this reference to reflect the
change in the general lending maturity limit to 15 years.
Regulatory Procedures
Regulatory Flexibility Act
The Regulatory Flexibility Act requires NCUA to prepare an analysis
to describe any significant economic impact a rule may have on a
substantial number of small credit unions, defined as those under ten
million dollars in assets. This rule clarifies and improves the
available services FCUs may provide to their members and persons within
their fields of membership, without imposing any regulatory burden. The
final amendments do not have a significant economic impact on a
substantial number of small credit unions, and, therefore, a regulatory
flexibility analysis is not required.
Paperwork Reduction Act
NCUA has determined that the final rule would not increase
paperwork requirements under the Paperwork Reduction Act of 1995 and
regulations of the Office of Management and Budget. 44 U.S.C. 3501 et
seq.; 5 CFR part 1320.
Executive Order 13132
Executive Order 13132 encourages independent regulatory agencies to
consider the impact of their actions on state and local interests. In
adherence to fundamental federalism principles, NCUA, an independent
regulatory agency as defined in 44 U.S.C. 3502(5), voluntarily complies
with the executive order. The final rule would not have substantial
direct effects on the states, on the connection between the national
government and the states, or on the distribution of power and
responsibilities among the various levels of government. NCUA has
determined that this rule does not constitute a policy that has
federalism implications for purposes of the executive order.
The Treasury and General Government Appropriations Act, 1999--
Assessment of Federal Regulations and Policies on Families
The NCUA has determined that this final rule would not affect
family well-being within the meaning of Sec. 654 of the Treasury and
General Government Appropriations Act, 1999, Pub. L. 105-277, 112 Stat.
2681 (1998).
Small Business Regulatory Enforcement Fairness Act
The Small Business Regulatory Enforcement Fairness Act of 1996,
Pub. L. 104-121 (SBREFA), provides generally for congressional review
of agency rules. A reporting requirement is triggered in instances
where NCUA issues a final rule as defined by Section 551 of the
Administrative Procedure Act. 5 U.S.C. 551. The Office of Management
and Budget has determined that this final rule is not a major rule for
purposes of SBREFA.
List of Subjects in 12 CFR Part 701
Check, Check cashing, Credit, Credit unions, Electronic funds
transfer, Money order, Money transfer.
0
For the reasons set forth in the preamble, the Board amends 12 CFR part
701 as set forth below.
By the National Credit Union Administration Board on February
15, 2007.
Mary F. Rupp,
Secretary of the Board.
0
Accordingly, the interim rule amending 12 CFR part 701, which was
published at 71 FR 62875 on October 27, 2006, is adopted as a final
rule with the following change:
PART 701--ORGANIZATION AND OPERATION OF FEDERAL CREDIT UNIONS
0
1. The authority citation for part 701 continues to read as follows:
Authority: 12 U.S.C. 1752(5), 1757, 1765, 1766, 1781, 1782,
1787, 1789; Title V, Pub. L. 109-351; 120 Stat. 1966.
0
2. Amend Section 701.21 by removing ``greater than twelve years'' in
the first sentence and adding in its place ``greater than fifteen
years'' in paragraph (g)(6)(ii).
[FR Doc. E7-2902 Filed 2-21-07; 8:45 am]
BILLING CODE 7535-01-P
