Current through Register Vol. 39, No. 6, September 16, 2024
(a) Monthly
Schedule of Delinquent Loans. Each credit union shall, at the end of each
month, prepare and review a schedule of delinquent loans that shall list the
account number, name(s) of borrower(s), date of loan, date of last payment,
original amount of loan, and outstanding balance of loan at date of schedule,
together with space to note current action or status.
(b) The unpaid balance of loans shall be set
apart in columns of the schedule of delinquent loans that shall indicate the
extent of delinquency as determined by the delinquent installments according to
the note contract, as follows:
(1) loans which
the delinquent installments are 60 days but less than 180 days past
due;
(2) loans which the delinquent
installments are 180 days but less than 365 days past due; and
(3) loans which the delinquent installments
are past due 365 days or more.
Similar formats customized to a credit union's needs shall
be acceptable as long as the report described in this Paragraph may be produced
upon request.
(c) Allowance for Loan Losses.
(1) Each credit union shall establish and
maintain the reserves as may be required by State laws and the rules of this
Subchapter, or in special cases by the Administrator as set forth in
G.S.
54-109.86. Each credit union shall establish
an Allowance for Loan Losses Account. The Allowance for Loan Losses Account is
not an addition to but a part of the Regular Reserve as required by
statute.
(2) The maintenance of a
valuation Allowance for Loan Losses Account shall not eliminate the requirement
for transferring a percentage of gross income before the payment of each
dividend to the regular reserve as required by State credit union laws andrules
of this Subchapter.
(3) Adjustments
to the valuation Allowance for Loan Losses shall be made prior to the
distribution or posting of any dividend to the accounts of all the members so
that the valuation allowance established presents the value of loans and
anticipated losses.
(4) Adjustments
to the valuation Allowance for Loan Losses shall be recorded in the expense
account "Provision for Loan Losses."
(5) Dividends shall not exceed the amount
available for that purpose after provisions have been made for the statutory
transfer to the Regular Reserve Account and the removal of any deficit in the
Regular Reserve Account.
(6) Each
credit union shall review the Allowance for Loan Losses Account quarterly for
accuracy prior to completion of the call report. An independent party shall
annually review the credit union's Allowance for Loan Losses Account. The
independent party shall have no connection to the credit approval, the
estimation process, the methodology, and its application.
Authority
G.S.
54-109.11(4);
54-109.12;
54-109.16;
54-109.17;
54-109.86;
54-109.87;
Eff.
February 1, 1976;
Readopted Eff. April 4, 1978;
Amended
Eff. February 1, 1992; October 1, 1983; January 1, 1983; March 1,
1982;
Readopted February 1, 2018.
