National Credit Union Administration 2020 – Federal Register Recent Federal Regulation Documents

The NCUA Board (Board) is amending its regulation governing assessment of an annual operating fee to Federal credit unions (FCUs). First, for purposes of calculating the annual operating fee, the final rule amends the current rule to exclude from total assets any loan an FCU reports under the Small Business Administration's Paycheck Protection Program (PPP) or similar future programs approved for exclusion by the NCUA Board. Second, the final rule deletes from the current regulation references to the Credit Union System Investment Program and the Credit Union Homeowners Affordability Relief Program, both of which no longer exist. Third, the final rule amends the period used for the calculation of an FCU's total assets. Currently, total assets are calculated using the FCU's December 31st Call Report of the preceding year. Under the final rule, total assets will be calculated as the average total assets reported on the FCU's previous four Call Reports available at the time the NCUA Board approves the agency's budget for the upcoming year, adjusted for any excludable programs as determined by the Board. Finally, the final rule makes some minor technical changes.

The NCUA Board (Board) is extending the effective date of its temporary final rule, which modified certain regulatory requirements to help ensure that federally insured credit unions (FICUs) remain operational and can properly conduct appropriate liquidity management to address economic conditions caused by the COVID-19 pandemic. Specifically, the temporary final rule issued by the Board in April 2020 temporarily raised the maximum aggregate amount of loan participations that a FICU may purchase from a single originating lender to the greater of $5,000,000 or 200 percent of the FICU's net worth. The rule also temporarily suspended limitations on the eligible obligations that a Federal credit union (FCU) may purchase and hold. In addition, given physical distancing practices necessitated by COVID-19, the rule also tolled the required timeframes for the occupancy or disposition of properties not being used for FCU business or that have been abandoned. Unless extended, each of these temporary modifications will expire on December 31, 2020. Due to the continued impact of COVID- 19, the Board has decided it is necessary to extend the effective period of these temporary modifications until December 31, 2021.

The National Credit Union Administration (NCUA) will be submitting the following information collection requests to the Office of Management and Budget (OMB) for review and clearance in accordance with the Paperwork Reduction Act of 1995 on or after the date of publication of this notice.

The NCUA Board (Board) seeks public comment on a proposed rule to amend its regulations by removing the prohibition on the capitalization of interest in connection with loan workouts and modifications. The Board has determined that the current prohibition on authorizing additional advances to finance unpaid interest may be overly burdensome and, in some cases, hamper a federally insured credit union's (FICU's) good-faith efforts to engage in loan workouts with borrowers facing difficulty because of the economic disruption that the COVID-19 pandemic has caused. Advancing interest may avert the need for alternative actions that would be more harmful to borrowers. The proposed rule would establish documentation requirements to help ensure that the addition of unpaid interest to the principal balance of a mortgage loan does not hinder the borrower's ability to become current on the loan. The proposed change would apply to workouts of all types of member loans, including commercial and business loans. The Board has also taken this opportunity to make several technical changes to the Appendix to improve its clarity and update certain references. For the convenience of readers, the Board is republishing the Appendix in its entirety so that the changes may be viewed in the context of the full document.

The National Credit Union Administration (NCUA), as part of a continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to comment on the following extension of a currently approved collection, as required by the Paperwork Reduction Act of 1995.

The OCC, Board, FDIC, NCUA, and Bureau (collectively, the agencies) are inviting comment on a proposed rule that would codify the Interagency Statement Clarifying the Role of Supervisory Guidance issued by the agencies on September 11, 2018 (2018 Statement). By codifying the 2018 Statement, the proposed rule is intended to confirm that the agencies will continue to follow and respect the limits of administrative law in carrying out their supervisory responsibilities. The 2018 Statement reiterated well-established law by stating that, unlike a law or regulation, supervisory guidance does not have the force and effect of law. As such, supervisory guidance does not create binding legal obligations for the public. The proposal would also clarify that the 2018 Statement, as amended, is binding on the agencies.

The National Credit Union Administration (NCUA), as part of a continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to comment on the following extensions of a currently approved collections, as required by the Paperwork Reduction Act of 1995.

The NCUA Board (Board) is adopting as final an interim final rule to temporarily amend its regulations requiring all federally insured credit unions to provide appraisals of real estate for certain real estate related transactions. The final rule defers the requirement to obtain an appraisal or written estimate of market value for up to 120 days following the closing of certain residential and commercial real estate transactions, excluding transactions for acquisition, development, and construction of real estate. Credit unions should make best efforts to obtain a credible estimate of the value of real property collateral before closing the loan, and otherwise underwrite loans consistent with safety and soundness principles. The final rule allows credit unions to expeditiously extend liquidity to creditworthy households and businesses in light of recent strains on the U.S. economy as a result of the coronavirus disease 2019 (COVID event). The final rule adopts the interim final rule without change. The final rule is similar to a recent final rule issued by the Office of the Comptroller of the Currency, Treasury (OCC); Board of Governors of the Federal Reserve System (FRB); and Federal Deposit Insurance Corporation (FDIC) (collectively, the other banking agencies) that also defers the requirement to obtain an appraisal or evaluation for up to 120 days following the closing of a transaction for certain residential and commercial real estate transactions.

The National Credit Union Administration (NCUA) will be submitting the following information collection requests to the Office of Management and Budget (OMB) for review and clearance in accordance with the Paperwork Reduction Act of 1995, on or after the date of publication of this notice.

On July 6, 2020, the OCC, Board, FDIC, FCA, and NCUA (collectively, the Agencies) published in the Federal Register a notice soliciting comments on a proposal to reorganize, revise, and expand the Interagency Questions and Answers Regarding Flood Insurance (July 2020 Proposed Questions and Answers). The July 2020 Proposed Questions and Answers provided for a comment period ending on September 4, 2020. The Agencies have determined that an extension of the comment period until November 3, 2020, is appropriate. This action will allow interested parties additional time to analyze the proposal and prepare and submit comments.

The NCUA Board (Board) proposes to amend its regulation governing assessment of an annual operating fee to federal credit unions (FCUs). First, for purposes of calculating the annual operating fee, the proposed rule would amend the current rule to exclude from total assets any loan an FCU reports under the Small Business Administration's Paycheck Protection Program (PPP) or similar future programs approved for exclusion by the NCUA Board. Second, the proposed rule would delete from the current regulation references to the Credit Union System Investment Program and the Credit Union Homeowners Affordability Relief Program, both of which no longer exist. Third, the proposed rule would amend the period used for the calculation of an FCU's total assets. Currently, total assets are calculated using the FCU's December 31st Call Report of the preceding year. Under the proposed rule, total assets would be calculated as the average total assets reported on the FCU's previous four Call Reports available at the time the NCUA Board approves the agency's budget for the upcoming year, adjusted for any excludable programs as determined by the Board. Finally, the proposed rule also would make some minor technical changes. The Board has separately published a document and requested public comment about the methodologies it uses for computing the Overhead Transfer Rate and setting the annual operating fee schedule for fees charged to FCUs. Members of the public are encouraged to comment about these methodologies by responding to the appropriate Federal Register document. The notice relating to National Credit Union Administration Overhead Transfer Rate Methodology and Operating Fee Schedule Methodology is published elsewhere in this issue of the Federal Register.

The National Credit Union Administration (NCUA), as part of a continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to comment on the following extension of a currently approved collection, as required by the Paperwork Reduction Act of 1995.

Due to the COVID-19 Pandemic, the meeting will be open to the public via live webcast only. Visit the agency's homepage (www.ncua.gov.) and access the provided webcast link.

The National Credit Union Administration (NCUA) will be submitting the following information collection request to the Office of Management and Budget (OMB) for review and clearance in accordance with the Paperwork Reduction Act of 1995 on or after the date of publication of this notice.

The National Credit Union Administration (NCUA) is conducting a comprehensive study of alternative procedures to modernize the agency's examination program. The objective of modernizing is to improve efficiency and effectiveness in achieving the NCUA's mandates under the Federal Credit Union Act. The agency seeks to support a predominately offsite examination and supervision model by taking advantage of new and emerging approaches and techniques to utilizing data and technology. Through modernization, the NCUA intends to: Reduce burden on credit unions and increase agency efficiency by reducing onsite examination time; Improve offsite supervision capabilities; Provide more consistency and standardization for the examination and supervision process; Improve communication between examiners, credit unions, and state supervisory authorities; and Explore and evaluate technology utilization and appetite for adoption. The NCUA is using this RFI as a research tool in its modernization efforts. Specifically, this RFI explains the NCUA's objectives and seeks assistance identifying the interrelated considerations and challenges that could arise if the agency moves forward with doing more examination work using technology. The resulting information will support a re-engineering of the concept of regulatory examination and supervision oversight. Recent events, such as the COVID-19 pandemic, have shown that adopting modern technology helps make credit unions more resilient to economic shocks. In turn, a credit union's resiliency has a positive impact on its member-owners and the economy at-large. Further, the current social unrest in the United States has exposed the limited financial options available to many minorities and underserved areas. This modernization effort could reduce the regulatory burden and establish technology options that would make it easier for credit unions to provide services to these underserved communities and populations. The NCUA seeks public input on its modernization initiative and is eager for feedback from interested stakeholders. The NCUA will use stakeholder responses to: Refine a strategy for leveraging technology in the future examination and supervision process; Determine how much onsite examination activity would still be required with an examination primarily done offsite; and Develop an implementation strategy that reduces burden while maintaining the agency's ability to determine whether federally insured credit unions are operating safely and soundly and in compliance with applicable laws and regulations. In addition to this RFI, the agency may seek clearance from the Office of Management and Budget to conduct stakeholder calls and form focus groups to gather additional information about barriers and benefits to the modernization initiative. The NCUA invites interested parties to respond generally to this modernization initiative and specifically to the questions included in this RFI.

The National Credit Union Administration (NCUA) will be submitting the following information collection request to the Office of Management and Budget (OMB) for review and clearance in accordance with the Paperwork Reduction Act of 1995 on or after the date of publication of this notice.

The National Credit Union Administration (NCUA), as part of a continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to comment on the following extension of a currently approved collection, as required by the Paperwork Reduction Act of 1995.

The National Credit Union Administration (NCUA), as part of a continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to comment on the following extension of a currently approved collection, as required by the Paperwork Reduction Act of 1995. The Office of Management and Budget (OMB) had granted emergency approval for revisions to the information collections requirements affected by NCUA's temporary final rule, ``Regulatory Relief in Response to COVID-19,'' published April 21, 2020, at 85 FR 22010, in accordance with 5 CFR 1320.13. This OMB approval is set to expire October 31, 2020.

The NCUA Board (Board) proposes to amend its share insurance regulation governing the requirements for a share account to be separately insured as a joint account by the National Credit Union Share Insurance Fund (NCUSIF). Specifically, the proposed rule would provide an alternative method to satisfy the membership card or account signature card requirement necessary for insurance coverage (signature card requirement). Under the proposal, even if an insured credit union cannot produce membership cards or account signature cards signed by the joint accountholders, the signature card requirement could be satisfied by information contained in the account records of the insured credit union establishing co-ownership of the share account. For example, the signature card requirement could be satisfied by the credit union having issued a mechanism for accessing the account, such as a debit card, to each co-owner or evidence of usage of the joint share account by each co-owner.

The Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the National Credit Union Administration (collectively, the agencies) are issuing an interagency policy statement on allowances for credit losses (ACLs). The agencies are issuing this interagency policy statement in response to changes to U.S. generally accepted accounting principles (GAAP) as promulgated by the Financial Accounting Standards Board (FASB) in Accounting Standards Update (ASU) 2016-13, Financial InstrumentsCredit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments and subsequent amendments issued since June 2016. These updates are codified in Accounting Standards Codification (ASC) Topic 326, Financial InstrumentsCredit Losses (FASB ASC Topic 326). This interagency policy statement describes the measurement of expected credit losses under the current expected credit losses (CECL) methodology and the accounting for impairment on available-for-sale debt securities in accordance with FASB ASC Topic 326; the design, documentation, and validation of expected credit loss estimation processes, including the internal controls over these processes; the maintenance of appropriate ACLs; the responsibilities of boards of directors and management; and examiner reviews of ACLs.