Accuracy of Advertising and Notice of Insured Status, 9347-9349 [E9-4600]

Download as PDF Federal Register / Vol. 74, No. 41 / Wednesday, March 4, 2009 / Rules and Regulations 740.4(a). The official NCUA sign informs and reassures members that their share deposits are guaranteed, to 12 CFR Part 740 certain limits, by the U.S. Government in the event the credit union fails. RIN 3133–AD52 Section 740.4(c) imposes additional requirements on federally insured credit Accuracy of Advertising and Notice of unions participating in shared branch Insured Status networks. Generally, federally insured AGENCY: National Credit Union credit unions are prohibited from Administration (NCUA). accepting funds at teller stations or windows where nonfederally insured ACTION: Final rule. credit unions also receive deposits. 12 SUMMARY: Section 740.4 of NCUA’s rules CFR 740.4(c). Tellers in ‘‘credit union requires that a federally insured credit centers, service centers, or branches union continuously display the official servicing more than one credit union’’ NCUA sign at every teller station or (i.e., shared branching networks) are window where insured funds or currently exempted from this deposits are normally received. Section prohibition, but only if they display a 740.4(c) requires that tellers accepting specific sign at each station or window share deposits for both federally insured above or beside the official NCUA sign. credit unions and nonfederally insured Id. This second sign must state that credit unions also post a second sign ‘‘[o]nly the following credit unions adjacent to the official NCUA sign. The serviced by this facility are federally current rule requires this second sign to insured by the NCUA,’’ followed by the list each federally insured credit union full name of each federally insured served by the teller along with a credit union displayed in lettering ‘‘of statement that only these credit unions such size and print to be clearly legible are federally insured. Due to the to all members conducting share or evolution of shared branch networks it share deposit transactions.’’ Id. As discussed in the proposal, the is now difficult for some tellers to present rule has several shortcomings. comply with this second signage For example, the current size of shared requirement and, accordingly, NCUA is branching networks makes compliance revising the rule to replace the required listing of credit unions with a statement with this section nearly impossible as an extremely large sign would be that not all of the credit unions served required to list the hundreds of federally by the teller are federally insured and that members should contact their credit insured credit unions participating in the largest shared branching networks, union if they need more information. and it is difficult to keep the sign upDATES: This rule is effective April 3, to-date as federally insured credit 2009. unions frequently join or leave these FOR FURTHER INFORMATION CONTACT: networks. 73 FR 62935, 62936 (Oct. 22, Elizabeth Wirick, Staff Attorney, Office 2008). Additionally, shared branching of General Counsel, National Credit activities increasingly take place in the Union Administration, 1775 Duke branches of particular credit unions Street, Alexandria, Virginia 22314–3428 rather than at stand-alone sites operated or telephone: (703) 518–6540. by third parties such as credit union SUPPLEMENTARY INFORMATION: service organizations. Id. The current rule prescribes the same sign for shared A. Background branch locations that are credit union NCUA proposed revisions to part 740 facilities as for locations operated by of its regulations, addressing the notice third parties. Finally, the current rule and advertising requirements applicable does not address signage requirements to credit unions insured by the National for branches of nonfederally insured Credit Union Share Insurance Fund credit unions participating in shared (NCUSIF) administered by NCUA, in branching networks and accepting October 2008. 73 FR 2935 (Oct. 22, deposits for federally insured credit 2008). Section 740.4(a) requires unions. Id. The proposed revisions to § 740.4(c) federally insured credit unions to post a sign at all teller stations that normally retained the general prohibition on federally insured credit unions receive deposits. This official NCUA receiving funds at any teller station or sign reads: ‘‘Your savings federally window where any nonfederally insured to at least $100,000 and backed by the full faith and credit of the United insured credit union also receives account funds, but set forth three States Government’’ accompanied by exceptions to this prohibition. The first the acronym ‘‘NCUA’’ and the words ‘‘National Credit Union Administration, two exceptions permit tellers at federally insured credit unions and a U.S. Government Agency.’’ 12 CFR NATIONAL CREDIT UNION ADMINISTRATION VerDate Nov<24>2008 15:05 Mar 03, 2009 Jkt 217001 PO 00000 Frm 00005 Fmt 4700 Sfmt 4700 9347 shared branches operated by non-credit union entities to receive deposits for nonfederally insured credit unions if these tellers post a second sign adjacent to the official NCUA sign. Under the proposal, the language for the second sign for tellers at federally insured credit unions reads as follows: This credit union participates in a shared branch network with other credit unions and accepts share deposits for members of those other credit unions. Not all of these other credit unions are federally insured. If you need information on the insurance status of your credit union, please contact your credit union directly. The second sign for tellers at shared branches operated by non-credit union entities is as follows: This facility accepts share deposits for multiple credit unions. Not all of these credit unions are federally insured. If you need information on the insurance status of your credit union, please contact your credit union directly. The third exception to the general prohibition addresses signage requirements at nonfederally insured credit unions. The proposal clarified that tellers in nonfederally insured credit unions may accept deposits for federally insured credit unions as part of a shared branch network. The proposal, however, prohibited a nonfederally insured credit union from displaying the official NCUA sign, as this could be very confusing to the members of the nonfederally insured credit union. Also, since the credit union will not display the official sign, there is no need for it to display the second sign. As discussed below, NCUA is adopting the rule as proposed with a slight revision to the second sign for shared branch locations at federally insured credit unions. B. Comments and Final Rule NCUA received sixteen comments on the proposal. All commenters generally agreed the current rule is difficult to comply with and not particularly useful to credit union members. Most commenters supported the revisions as proposed by NCUA or with minor changes. A few commenters opposed any requirement for a second sign and recommended NCUA repeal the requirement. Three commenters who generally supported the proposal suggested the second sign should only be required at one, central location instead of next to every official insurance sign. NCUA has not adopted this suggestion in the final rule because members could be misled about the insurance status of their credit union if the second sign required by E:\FR\FM\04MRR1.SGM 04MRR1 9348 Federal Register / Vol. 74, No. 41 / Wednesday, March 4, 2009 / Rules and Regulations § 740.4(c) is not adjacent to every official insurance sign. Similarly, NCUA did not adopt the suggestion of another commenter who requested that federally insured credit unions have the option to distribute a paper notice to ‘‘guest’’ members using the federally insured credit union as a shared branch instead of posting the second signs. One problem with this suggestion is that members are more likely to miss this notice if it is presented on a separate flyer at the entrance or accompanies the member’s transaction information distributed by a teller. Another problem with this suggestion is that tellers may fail to distribute the notice to all guests, and it would be difficult for NCUA to assess compliance with this requirement. In contrast, the short, clear second sign gives members the information they need in a format they are most likely to notice and absorb. The straightforward requirement for a second sign also makes compliance with the regulation and assessing compliance with the regulation easier than would allowing a separate disclosure to guest members. Another commenter suggested that it would be more useful for the second sign to list the nonfederally insured credit unions participating in the shared branching network. This commenter stated that since the vast majority of credit unions are federally insured, a second sign listing the names of the nonfederally insured credit unions would be much shorter and give members exactly the information they need without the extra step of contacting their credit union. NCUA agrees this option would reduce the regulatory burden on credit unions and in theory could provide more complete information for credit union members. NCUA has not adopted this suggestion, however, because of concern that members of nonfederally insured credit unions would see the name of their nonfederally insured credit union on a sign immediately adjacent to the official NCUA insurance sign and could, if they did not read the sign very carefully, erroneously conclude their credit union was federally insured. Two commenters requested NCUA add a phrase to the second sign required by § 740.4(c) for tellers at federally insured credit unions reiterating the credit union is federally insured, and NCUA has adopted this change in the final rule. The second sign for tellers in federally insured credit unions is amended to read as follows: This credit union participates in a shared branch network with other credit unions and accepts share deposits for members of those other credit unions. While this credit union VerDate Nov<24>2008 15:05 Mar 03, 2009 Jkt 217001 is federally insured, not all of these other credit unions are federally insured. If you need information on the insurance status of your credit union, please contact your credit union directly. Like the commenters requesting this change, NCUA has observed an increasing focus on deposit insurance coverage among credit union members as turbulence in the financial marketplace continues. Although NCUA believes very few members would be confused by the second sign as proposed since it would be posted adjacent to the official insurance sign, NCUA agrees the suggested clarification is useful and adopts it in the final rule. Finally, one commenter opined that the proposal would permit federally insured credit unions flexibility to draft slightly differing language for the second sign required by § 704.4(c). This is not true. While the design, color, and font of the second sign may depart from NCUA’s template, the language must conform to the regulation exactly. As discussed in the proposal, the second sign required by § 740.4(c) must be conspicuous and be similar to the official NCUA sign in terms of design, color, and font. NCUA will produce signs that meet this requirement and make the signs available for purchase at a reasonable cost. Credit unions may either use the NCUA-produced sign or produce their own sign, as long as the sign meets the requirements of the rule. 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 will not impose any regulatory burden and in fact will ease existing compliance burdens on federally insured credit unions participating in shared branch networks and accepting deposits for both federally insured and nonfederally insured credit unions. The Board certifies that this rule will not have a significant economic impact on a substantial number of small credit unions, and, therefore, a regulatory flexibility analysis is not required. Small Business Regulatory Enforcement Act The Small Business Regulatory Enforcement Fairness Act (SBREFA) of 1996, Public Law 104–121, 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 Procedures Act. 5 U.S.C. 551. NCUA does not believe this rule is a major rule for purposes of SBREFA. Paperwork Reduction Act NCUA has determined that the rule will 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 rule will 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 rule will not affect family well-being within the meaning of § 654 of the Treasury and General Government Appropriations Act, 1999, Public Law 105–277, 112 Stat. 2681 (1998). List of Subjects in 12 CFR Part 740 Advertisements, Credit unions, Signs and symbols. By the National Credit Union Administration Board on February 26, 2009. Mary F. Rupp, Secretary of the Board. For the reasons set forth above, NCUA amends 12 CFR part 740 as follows. ■ PART 740—ACCURACY OF ADVERTISING AND NOTICE OF INSURED STATUS 1. The authority citation for part 740 continues to read as follows: ■ Authority: 12 U.S.C. 1766, 1781, 1785, and 1789. 2. Amend § 740.1 by revising paragraph (b), and adding paragraph (c), to read as follows: ■ E:\FR\FM\04MRR1.SGM 04MRR1 Federal Register / Vol. 74, No. 41 / Wednesday, March 4, 2009 / Rules and Regulations § 740.1 Definitions. * * * * * (b) Insured credit union and federally insured credit union as used in this part mean a credit union with National Credit Union Administration share insurance. (c) Nonfederally insured credit union as used in this part means a credit union with either no account insurance or with primary account insurance provided by some entity other than the National Credit Union Administration. 3. Amend § 740.4 by revising paragraph (c) to read as follows: ■ § 740.4 Requirements for the official sign. * * * * * (c) To avoid any member confusion from the use of the official NCUA sign, federally insured credit unions are prohibited from receiving account funds at any teller station or window where any nonfederally insured credit union also receives account funds. As exceptions to this prohibition: (1) A teller in a branch of a federally insured credit union may accept account funds for nonfederally insured credit unions, but only if the teller displays a conspicuous sign next to the official sign that states ‘‘This credit union participates in a shared branch network with other credit unions and accepts share deposits for members of those other credit unions. While this credit union is federally insured, not all of these other credit unions are federally insured. If you need information on the insurance status of your credit union, please contact your credit union directly.’’ This sign must be similar to the official sign in terms of design, color, and font. (2) A teller in a facility operated by a non-credit union entity may accept account funds for both federally insured credit unions and nonfederally insured credit unions, but only if the teller displays a conspicuous sign next to the official sign stating ‘‘This facility accepts share deposits for multiple credit unions. Not all of these credit unions are federally insured. If you need information on the insurance status of your credit union, please contact your credit union directly.’’ This sign must be similar to the official sign in terms of design, color, and font. (3) A teller in a branch of a nonfederally insured credit union may accept account funds for federally insured credit unions. No teller in a VerDate Nov<24>2008 15:05 Mar 03, 2009 Jkt 217001 nonfederally insured credit union may display the official NCUA sign. * * * * * [FR Doc. E9–4600 Filed 3–3–09; 8:45 am] BILLING CODE 7535–01–P NATIONAL CREDIT UNION ADMINISTRATION 12 CFR Part 747 Civil Monetary Penalty Inflation Adjustment AGENCY: National Credit Union Administration. ACTION: Final rule. The National Credit Union Administration (NCUA) is amending its rules of practice and procedure to adjust the maximum amount of each civil money penalty (CMP) within its jurisdiction to account for inflation. This action, including the amount of the adjustment, is required under the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Debt Collection Improvement Act of 1996. DATES: Effective Date: March 4, 2009. FOR FURTHER INFORMATION CONTACT: John K. Ianno, Associate General Counsel, or Jon Canerday, Trial Attorney, Office of General Counsel, NCUA, 1775 Duke Street, Alexandria, Virginia 22314, or telephone (703) 518–6540. SUPPLEMENTARY INFORMATION: SUMMARY: A. Background The Debt Collection Improvement Act of 1996 1 (DCIA) amended the Federal Civil Penalties Inflation Adjustment Act of 1990 2 (FCPIA Act) to require every Federal agency to enact regulations that adjust each civil monetary penalty (CMP) provided by law under its jurisdiction by the rate of inflation at least once every 4 years. These periodic adjustments are to be calculated pursuant to the inflation adjustment formula in section 5(b) of the FCPIA Act. Section 6 of the FCPIA Act specifies that inflation-adjusted CMPs will only apply to violations that occur after the effective date of the adjustment. The inflation adjustment is based on the percentage increase in the Consumer 1 Public Law 104–134, 31001(s), 110 Stat. 1321– 373, (Apr. 26, 1996). The provision is codified at 28 U.S.C. 2461 note. 2 Public Law 101–410, 104 Stat. 890, (Oct. 5, 1990), also codified at 28 U.S.C. 2461 note. PO 00000 Frm 00007 Fmt 4700 Sfmt 4700 9349 Price Index for all urban consumers (CPI–U) published by the Department of Labor.3 Specifically, section 5(b) of the FCPIA Act defines the term ‘‘cost-ofliving adjustment’’ as ‘‘the percentage (if any) for each civil monetary penalty by which—(1) the Consumer Price Index for the month of June of the calendar year preceding the adjustment, exceeds (2) the Consumer Price Index for the month of June of the calendar year in which the amount of such civil monetary penalty was last set or adjusted pursuant to law.’’ The amount of each inflation adjustment must then be rounded to a number prescribed by section 5(a) of the FCPIA Act. B. Mathematical Calculations of the Adjustments NCUA last adjusted the CMPs it is authorized to impose in 2004. 69 FR 60080. Accordingly, the current adjustment of these CMPs will be the percentage by which the CPI–U for the month of June 2007 exceeds the CPI–U for the month of June 2004. According to the Bureau of Labor Statistics, the CPI–U for the month of June 2004 was 189.7 and the CPI–U for the month of June 2007 was 208.352. The percentage by which the 2007 figure exceeds the 2004 figure is 9.8 percent. Thus, the CMPs should be multiplied by 9.8 percent, the resulting dollar amount rounded up or down according to the rounding requirements of the FCPIA Act, and then that amount added to the current penalty. In some cases, the rounding rules resulted in no adjustment to the amount of the CMP. In previous years, the Board has explained in detail the adjustment procedure for each of the CMPs under its jurisdiction. Detailed explanations were provided because some CMPs were adjusted for the first time, requiring the use of different formulas. In view of the fact that all of the CMPs were last adjusted in 2004, such detailed explanations are no longer necessary. For that reason, and to be consistent with the other banking agencies, the Board will show the adjustments in table format. The following table shows both the present CMPs, the adjustment methodology, and the CMPs after being adjusted for inflation. The table published in 12 CFR 747.1001 shows only the adjusted CMPs, not the calculations. 3 The CPI–U is published by the Department of Labor, Bureau of Labor Statistics, and is available at its Web site: http://www.bls.gov/cpi/. E:\FR\FM\04MRR1.SGM 04MRR1

Agencies

[Federal Register Volume 74, Number 41 (Wednesday, March 4, 2009)]
[Rules and Regulations]
[Pages 9347-9349]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-4600]



[[Page 9347]]

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NATIONAL CREDIT UNION ADMINISTRATION

12 CFR Part 740

RIN 3133-AD52


Accuracy of Advertising and Notice of Insured Status

AGENCY: National Credit Union Administration (NCUA).

ACTION: Final rule.

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SUMMARY: Section 740.4 of NCUA's rules requires that a federally 
insured credit union continuously display the official NCUA sign at 
every teller station or window where insured funds or deposits are 
normally received. Section 740.4(c) requires that tellers accepting 
share deposits for both federally insured credit unions and 
nonfederally insured credit unions also post a second sign adjacent to 
the official NCUA sign. The current rule requires this second sign to 
list each federally insured credit union served by the teller along 
with a statement that only these credit unions are federally insured. 
Due to the evolution of shared branch networks it is now difficult for 
some tellers to comply with this second signage requirement and, 
accordingly, NCUA is revising the rule to replace the required listing 
of credit unions with a statement that not all of the credit unions 
served by the teller are federally insured and that members should 
contact their credit union if they need more information.

DATES: This rule is effective April 3, 2009.

FOR FURTHER INFORMATION CONTACT: Elizabeth Wirick, Staff Attorney, 
Office of General Counsel, National Credit Union Administration, 1775 
Duke Street, Alexandria, Virginia 22314-3428 or telephone: (703) 518-
6540.

SUPPLEMENTARY INFORMATION:

A. Background

    NCUA proposed revisions to part 740 of its regulations, addressing 
the notice and advertising requirements applicable to credit unions 
insured by the National Credit Union Share Insurance Fund (NCUSIF) 
administered by NCUA, in October 2008. 73 FR 2935 (Oct. 22, 2008). 
Section 740.4(a) requires federally insured credit unions to post a 
sign at all teller stations that normally receive deposits. This 
official NCUA sign reads: ``Your savings federally insured to at least 
$100,000 and backed by the full faith and credit of the United States 
Government'' accompanied by the acronym ``NCUA'' and the words 
``National Credit Union Administration, a U.S. Government Agency.'' 12 
CFR 740.4(a). The official NCUA sign informs and reassures members that 
their share deposits are guaranteed, to certain limits, by the U.S. 
Government in the event the credit union fails.
    Section 740.4(c) imposes additional requirements on federally 
insured credit unions participating in shared branch networks. 
Generally, federally insured credit unions are prohibited from 
accepting funds at teller stations or windows where nonfederally 
insured credit unions also receive deposits. 12 CFR 740.4(c). Tellers 
in ``credit union centers, service centers, or branches servicing more 
than one credit union'' (i.e., shared branching networks) are currently 
exempted from this prohibition, but only if they display a specific 
sign at each station or window above or beside the official NCUA sign. 
Id. This second sign must state that ``[o]nly the following credit 
unions serviced by this facility are federally insured by the NCUA,'' 
followed by the full name of each federally insured credit union 
displayed in lettering ``of such size and print to be clearly legible 
to all members conducting share or share deposit transactions.'' Id.
    As discussed in the proposal, the present rule has several 
shortcomings. For example, the current size of shared branching 
networks makes compliance with this section nearly impossible as an 
extremely large sign would be required to list the hundreds of 
federally insured credit unions participating in the largest shared 
branching networks, and it is difficult to keep the sign up-to-date as 
federally insured credit unions frequently join or leave these 
networks. 73 FR 62935, 62936 (Oct. 22, 2008). Additionally, shared 
branching activities increasingly take place in the branches of 
particular credit unions rather than at stand-alone sites operated by 
third parties such as credit union service organizations. Id. The 
current rule prescribes the same sign for shared branch locations that 
are credit union facilities as for locations operated by third parties. 
Finally, the current rule does not address signage requirements for 
branches of nonfederally insured credit unions participating in shared 
branching networks and accepting deposits for federally insured credit 
unions. Id.
    The proposed revisions to Sec.  740.4(c) retained the general 
prohibition on federally insured credit unions receiving funds at any 
teller station or window where any nonfederally insured credit union 
also receives account funds, but set forth three exceptions to this 
prohibition. The first two exceptions permit tellers at federally 
insured credit unions and shared branches operated by non-credit union 
entities to receive deposits for nonfederally insured credit unions if 
these tellers post a second sign adjacent to the official NCUA sign. 
Under the proposal, the language for the second sign for tellers at 
federally insured credit unions reads as follows:

    This credit union participates in a shared branch network with 
other credit unions and accepts share deposits for members of those 
other credit unions. Not all of these other credit unions are 
federally insured. If you need information on the insurance status 
of your credit union, please contact your credit union directly.

The second sign for tellers at shared branches operated by non-credit 
union entities is as follows:

    This facility accepts share deposits for multiple credit unions. 
Not all of these credit unions are federally insured. If you need 
information on the insurance status of your credit union, please 
contact your credit union directly.

    The third exception to the general prohibition addresses signage 
requirements at nonfederally insured credit unions. The proposal 
clarified that tellers in nonfederally insured credit unions may accept 
deposits for federally insured credit unions as part of a shared branch 
network. The proposal, however, prohibited a nonfederally insured 
credit union from displaying the official NCUA sign, as this could be 
very confusing to the members of the nonfederally insured credit union. 
Also, since the credit union will not display the official sign, there 
is no need for it to display the second sign.
    As discussed below, NCUA is adopting the rule as proposed with a 
slight revision to the second sign for shared branch locations at 
federally insured credit unions.

B. Comments and Final Rule

    NCUA received sixteen comments on the proposal. All commenters 
generally agreed the current rule is difficult to comply with and not 
particularly useful to credit union members. Most commenters supported 
the revisions as proposed by NCUA or with minor changes. A few 
commenters opposed any requirement for a second sign and recommended 
NCUA repeal the requirement.
    Three commenters who generally supported the proposal suggested the 
second sign should only be required at one, central location instead of 
next to every official insurance sign. NCUA has not adopted this 
suggestion in the final rule because members could be misled about the 
insurance status of their credit union if the second sign required by

[[Page 9348]]

Sec.  740.4(c) is not adjacent to every official insurance sign. 
Similarly, NCUA did not adopt the suggestion of another commenter who 
requested that federally insured credit unions have the option to 
distribute a paper notice to ``guest'' members using the federally 
insured credit union as a shared branch instead of posting the second 
signs. One problem with this suggestion is that members are more likely 
to miss this notice if it is presented on a separate flyer at the 
entrance or accompanies the member's transaction information 
distributed by a teller. Another problem with this suggestion is that 
tellers may fail to distribute the notice to all guests, and it would 
be difficult for NCUA to assess compliance with this requirement. In 
contrast, the short, clear second sign gives members the information 
they need in a format they are most likely to notice and absorb. The 
straightforward requirement for a second sign also makes compliance 
with the regulation and assessing compliance with the regulation easier 
than would allowing a separate disclosure to guest members.
    Another commenter suggested that it would be more useful for the 
second sign to list the nonfederally insured credit unions 
participating in the shared branching network. This commenter stated 
that since the vast majority of credit unions are federally insured, a 
second sign listing the names of the nonfederally insured credit unions 
would be much shorter and give members exactly the information they 
need without the extra step of contacting their credit union. NCUA 
agrees this option would reduce the regulatory burden on credit unions 
and in theory could provide more complete information for credit union 
members. NCUA has not adopted this suggestion, however, because of 
concern that members of nonfederally insured credit unions would see 
the name of their nonfederally insured credit union on a sign 
immediately adjacent to the official NCUA insurance sign and could, if 
they did not read the sign very carefully, erroneously conclude their 
credit union was federally insured.
    Two commenters requested NCUA add a phrase to the second sign 
required by Sec.  740.4(c) for tellers at federally insured credit 
unions reiterating the credit union is federally insured, and NCUA has 
adopted this change in the final rule. The second sign for tellers in 
federally insured credit unions is amended to read as follows:

    This credit union participates in a shared branch network with 
other credit unions and accepts share deposits for members of those 
other credit unions. While this credit union is federally insured, 
not all of these other credit unions are federally insured. If you 
need information on the insurance status of your credit union, 
please contact your credit union directly.

Like the commenters requesting this change, NCUA has observed an 
increasing focus on deposit insurance coverage among credit union 
members as turbulence in the financial marketplace continues. Although 
NCUA believes very few members would be confused by the second sign as 
proposed since it would be posted adjacent to the official insurance 
sign, NCUA agrees the suggested clarification is useful and adopts it 
in the final rule.
    Finally, one commenter opined that the proposal would permit 
federally insured credit unions flexibility to draft slightly differing 
language for the second sign required by Sec.  704.4(c). This is not 
true. While the design, color, and font of the second sign may depart 
from NCUA's template, the language must conform to the regulation 
exactly.
    As discussed in the proposal, the second sign required by Sec.  
740.4(c) must be conspicuous and be similar to the official NCUA sign 
in terms of design, color, and font. NCUA will produce signs that meet 
this requirement and make the signs available for purchase at a 
reasonable cost. Credit unions may either use the NCUA-produced sign or 
produce their own sign, as long as the sign meets the requirements of 
the rule.

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 will not impose any regulatory 
burden and in fact will ease existing compliance burdens on federally 
insured credit unions participating in shared branch networks and 
accepting deposits for both federally insured and nonfederally insured 
credit unions. The Board certifies that this rule will not have a 
significant economic impact on a substantial number of small credit 
unions, and, therefore, a regulatory flexibility analysis is not 
required.

Small Business Regulatory Enforcement Act

    The Small Business Regulatory Enforcement Fairness Act (SBREFA) of 
1996, Public Law 104-121, 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 Procedures Act. 5 U.S.C. 551. NCUA does not believe this 
rule is a major rule for purposes of SBREFA.

Paperwork Reduction Act

    NCUA has determined that the rule will 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 rule will 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 rule will not affect family well-
being within the meaning of Sec.  654 of the Treasury and General 
Government Appropriations Act, 1999, Public Law 105-277, 112 Stat. 2681 
(1998).

List of Subjects in 12 CFR Part 740

    Advertisements, Credit unions, Signs and symbols.

    By the National Credit Union Administration Board on February 
26, 2009.
Mary F. Rupp,
Secretary of the Board.

0
For the reasons set forth above, NCUA amends 12 CFR part 740 as 
follows.

PART 740--ACCURACY OF ADVERTISING AND NOTICE OF INSURED STATUS

0
1. The authority citation for part 740 continues to read as follows:

    Authority: 12 U.S.C. 1766, 1781, 1785, and 1789.


0
2. Amend Sec.  740.1 by revising paragraph (b), and adding paragraph 
(c), to read as follows:

[[Page 9349]]

Sec.  740.1  Definitions.

* * * * *
    (b) Insured credit union and federally insured credit union as used 
in this part mean a credit union with National Credit Union 
Administration share insurance.
    (c) Nonfederally insured credit union as used in this part means a 
credit union with either no account insurance or with primary account 
insurance provided by some entity other than the National Credit Union 
Administration.


0
3. Amend Sec.  740.4 by revising paragraph (c) to read as follows:


Sec.  740.4  Requirements for the official sign.

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    (c) To avoid any member confusion from the use of the official NCUA 
sign, federally insured credit unions are prohibited from receiving 
account funds at any teller station or window where any nonfederally 
insured credit union also receives account funds. As exceptions to this 
prohibition:
    (1) A teller in a branch of a federally insured credit union may 
accept account funds for nonfederally insured credit unions, but only 
if the teller displays a conspicuous sign next to the official sign 
that states ``This credit union participates in a shared branch network 
with other credit unions and accepts share deposits for members of 
those other credit unions. While this credit union is federally 
insured, not all of these other credit unions are federally insured. If 
you need information on the insurance status of your credit union, 
please contact your credit union directly.'' This sign must be similar 
to the official sign in terms of design, color, and font.
    (2) A teller in a facility operated by a non-credit union entity 
may accept account funds for both federally insured credit unions and 
nonfederally insured credit unions, but only if the teller displays a 
conspicuous sign next to the official sign stating ``This facility 
accepts share deposits for multiple credit unions. Not all of these 
credit unions are federally insured. If you need information on the 
insurance status of your credit union, please contact your credit union 
directly.'' This sign must be similar to the official sign in terms of 
design, color, and font.
    (3) A teller in a branch of a nonfederally insured credit union may 
accept account funds for federally insured credit unions. No teller in 
a nonfederally insured credit union may display the official NCUA sign.
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[FR Doc. E9-4600 Filed 3-3-09; 8:45 am]
BILLING CODE 7535-01-P