National Credit Union Administration August 2014 – Federal Register Recent Federal Regulation Documents

The NCUA Board (Board) proposes to amend its regulation governing federal credit union (FCU) ownership of fixed assets to provide regulatory relief and to help FCUs better manage their fixed assets. The proposed rule provides greater flexibility to FCUs by removing the waiver requirement for FCUs to exceed the five percent aggregate limit on investments in fixed assets. An FCU that chooses to exceed the five percent aggregate limit may do so without prior NCUA approval, provided it implements a fixed assets management (FAM) program that demonstrates appropriate pre-acquisition analysis to ensure the FCU can afford any impact on earnings and net worth levels. An FCU's FAM program is subject to supervisory scrutiny and must provide for close ongoing oversight of fixed assets levels and their effect on the financial performance of the FCU. It must also include a written policy that sets an FCU board-established limit on the aggregate amount of the FCU's fixed assets. In addition, the proposal simplifies the partial occupancy requirement for premises acquired for future expansion.