Board Action Bulletin
The NCUA Board considered two share insurance appeals, both of which remain confidential at this time.
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ALEXANDRIA, Va. (Aug. 5, 2014) – All 62 credit unions subject to civil money penalties for the late filing of their first-quarter Call Reports have consented to those penalties, the National Credit Union Administration announced today.
The late filers will pay a total of $57,750 in penalties. Individual penalties range from $150 to $20,000. The median fine was $243. The Federal Credit Union Act requires any civil money penalties be sent to the U.S. Treasury.
“Our intention is that credit unions fully comply with the deadline for filing Call Reports,” NCUA Board Chairman Debbie Matz said. “We’ve seen an improvement from the days when more than 1,000 credit unions filed late, but we haven’t yet reached the goal of timely filing by all credit unions every quarter.”
Of the 62 credit unions paying penalties in the first quarter, 38 have assets below $10 million, 18 have assets between $10 million and $50 million, and 6 have assets between $50 million and $250 million. A list of credit unions that filed late and that have agreed to pay civil money penalties is available online here.
A total of 104 credit unions filed Call Reports late for the first quarter of 2014. During its initial review, NCUA consulted regional offices and, when appropriate, state supervisory authorities. These consultations determined mitigating circumstances in 20 cases allowed credit unions to avoid a penalty.
NCUA informed the remaining 84 credit unions in mid-June of penalties they faced, and the agency advised them they could reduce their penalties by signing a consent agreement. NCUA also said it would initiate administrative hearings against credit unions that did not consent.
Several credit unions subsequently provided the agency with information about circumstances that led to their filing late. NCUA determined 22 of those credit unions would not be penalized.
Assessment of penalties primarily depended on three factors: the credit union’s asset size, the length of the delay, and whether the credit union had been late the previous quarter in filing its Call Report.
NCUA in January sent a Letter to Credit Unions about assessing civil money penalties against credit unions that did not meet the Call Report filing deadlines. The agency subsequently began sending reminder messages about the Call Report filing deadline that included information on how to receive technical support to handle filing problems. NCUA also produced a video (opens new window) describing how to file Call Reports.
ALEXANDRIA, Va. (Sept. 5, 2014) – The Iowa Credit Union Division today was granted authority by the District Court to place Louden Depot Community Credit Union of Fairfield, Iowa, into receivership and then tendered the receivership to the National Credit Union Administration.
Community 1st Credit Union of Ottumwa, Iowa, immediately assumed most of Louden Depot Community Credit Union’s members, assets, and loans. Community 1st is a federally insured, state-chartered credit union with assets of $505.4 million serving 50,946 members, according to the credit union’s most recent Call Report.
The new members of Community 1st should experience no interruption in service at the current Louden Depot Community Credit Union location during this transition. Members with questions about share accounts may contact Community 1st at 641-472-9770 or by email at [email protected]. The credit union is open Monday through Friday between 8 a.m. and 5 p.m., Central.
Accounts of the new Community 1st members remain insured by the National Credit Union Share Insurance Fund. Administered by NCUA, the Share Insurance Fund insures individual accounts up to $250,000. A member’s interest in all joint accounts combined is insured up to $250,000. The Share Insurance Fund separately protects IRA and KEOGH retirement accounts up to $250,000. The Share Insurance Fund has the backing of the full faith and credit of the United States. Individuals may also visit the MyCreditUnion.gov (opens new window) website at any time for more information about their insurance coverage.
The Iowa Credit Union Division made the decision to take over management of Louden Depot Community Credit Union and determined the credit union was insolvent with no prospect for restoring viable operations on its own.
Chartered in 1954, Louden Depot Community Credit Union served persons residing or employed within Jefferson County and the contiguous counties, former members of the Meritor Employees Credit Union, employees of such small employee groups as approved by the Superintendent of the Iowa Credit Union Division and family members. Louden Depot Community Credit Union had assets of approximately $5 million and served 790 members, according to the credit union’s most recent Call Report.
Louden Depot Community Credit Union is the seventh federally insured credit union liquidation in 2014.
Board Action Bulletin
The NCUA Board unanimously designated Board Member Rick Metsger as Vice-Chairman.
The NCUA Board also considered a supervisory matter, and a share insurance appeal. Both of these matters remain confidential at this time.
NCUA tweets all open Board meetings live. Follow
@TheNCUA (opens new window) on Twitter, and access Board Action Memorandums and NCUA rule changes at
www.ncua.gov. NCUA also live streams, archives and posts
videos of open Board meetings online.
ALEXANDRIA, Va. (Sept. 18, 2014) – The National Credit Union Administration Board unanimously voted today to designate Board Member Rick Metsger as Vice Chairman of NCUA, effective immediately, pursuant to the requirements of NCUA’s rules.
President Barack Obama nominated Metsger on May 16, 2013, for an NCUA Board term that will expire on Aug. 2, 2017. After confirmation by the U.S. Senate, Metsger participated in his first NCUA Board meeting on Sept. 12, 2013.
On Jan. 1, 2014, Matz appointed Metsger as NCUA’s representative on the Board of NeighborWorks America, one of the nation’s preeminent affordable housing and community development organizations.
Before joining the NCUA Board, Metsger was most recently president of a strategic affairs consulting firm. He served in the Oregon State Senate from 1999 to 2011, and his committee assignments included chairing the Senate Business Committee as well as extensive work in the areas of financial services, transportation and economic development policy. He was elected Senate President Pro Tempore in 2009.
Metsger previously served on the board of the Portland Teachers Credit Union.
ALEXANDRIA, Va. (Sept. 18, 2014) – The National Credit Union Administration Board convened its eighth scheduled open meeting of 2014 at the agency’s headquarters here today. The Board unanimously approved two items:
The Chief Financial Officer also briefed the Board on the performance of the Temporary Corporate Credit Union Stabilization Fund, which achieved a positive net position for the first time.
Stabilization Fund’s Assets Exceed Obligations
As of June 30, 2014, the Stabilization Fund reported for the first time a positive net position of $51.2 million, improving by $91.6 million from a $40.4 million deficit at the end of the first quarter. The change in the net position resulted primarily from improvements in projected cash flows relating to legacy assets that secure the NCUA Guaranteed Notes (NGN) Program.
“The cash flows from the legacy assets along with NCUA’s prudent management of the NGN Program continue to yield improved Stabilization Fund performance,” NCUA Board Chairman Debbie Matz said. “The Board announced last November we do not plan a Stabilization Fund assessment for 2014, and at this time we don’t expect to charge any more assessments in the future.”
The Stabilization Fund repaid $300 million to the U.S. Treasury during the second quarter of 2014. Outstanding borrowings from the U.S. Treasury were $2.6 billion at the end of the quarter. All obligations are scheduled to be repaid before the Stabilization Fund expires in June 2021.
The positive Stabilization Fund balance, however, does not mean there are funds available to provide credit unions with a refund at this time. The improving values of the legacy assets are not available, as they secure the NGNs. NCUA also still must repay the money borrowed from the U.S. Treasury.
Finally, the projections are estimates. Future changes in the economy or the performance of the legacy assets are likely to change the value of the assets NCUA and the Stabilization Fund can eventually access at the end of the NGN Program.
The Stabilization Fund’s second-quarter figures are preliminary and unaudited.
Charter Expansion Opens First Service to Nearly 1.8 Million Potential Members
Almost 1.8 million people are now potential members of First Service Federal Credit Union, headquartered in Groveport, Ohio, after the NCUA Board approved expansion of the credit union’s community charter to serve part of the Columbus, Ohio, Metropolitan Statistical Area.
The full-service, community-chartered credit union requested the field-of-membership expansion to ensure future membership growth and provide low-cost loans and financial literacy programs to a broader segment of the local population. First Service has 16,104 members and assets of $135.2 million, according to its most recent Call Report.
“This charter expansion will allow First Service to meet expanding loan demand from beyond its current single-county community and potentially reach an additional 115,000 underserved residents,” Matz said. “First Service plans to minimize fees and promote products that build credit, offering a particular benefit to low-income residents. Notably, the credit union will reach out with bilingual employees, as nine percent of the local population speaks a language other than English. Finally, First Service will offer a wide range of electronic services including a partnership with three banks to offer ATM withdrawals nationwide.”
First Service will now serve persons who live, work, worship or regularly conduct business or attend school, and businesses and other legal entities in Delaware, Fairfield, Franklin, Licking, Madison, Morrow, Pickaway and Union counties.
Originally chartered in 1956 as Lockbourne Federal Credit Union, First Service initially served Lockbourne Air Force Base active-duty personnel. Over the years, the credit union expanded its membership by adding select employee groups and in 1984 converted to a community charter. In 1999, the credit union expanded its community charter to serve Franklin County.
Board approval is required for community charters to serve a population of more than 1 million.
Housekeeping Amendments Repeal NCUA’s Unfair or Deceptive Acts Rule
The Board approved a final rule repealing NCUA regulations on unfair or deceptive practices and making other technical and housekeeping amendments to the agency’s rules.
The Dodd-Frank Act repealed NCUA’s rulemaking authority under the Federal Trade Commission Act to regulate unfair or deceptive acts or practices. As a result, the Board acted to repeal the agency’s regulations covering those acts and practices (Part 706). However, credit unions still must comply with rules issued by the Consumer Financial Protection Bureau on unfair and deceptive acts and practices. NCUA continues to have supervisory and enforcement authority regarding unfair deceptive acts and practices.
The final rule also makes technical amendments to update terminology referring to payday alternative loans (Part 701) to more accurately reflect the nature and purpose of the loan product, and to conform NCUA’s rules with recent agency restructurings (Part 790).
ALEXANDRIA, Va. (Sept. 23, 2014) – In the coming months, thousands of people nationwide will be able to prepare healthy meals with food donated by National Credit Union Administration employees during the federal government’s annual Feds Feed Families (opens new window) food drive.
“For the first time, all NCUA offices and regions participated in Feds Feed Families, and the outcome was truly amazing,” NCUA Board Chairman Debbie Matz said. “Together, NCUA staff donated an amazing 92,950 pounds of food to give to families and children in need. We more than quadrupled the amount given last year to provide almost 62,000 meals.”
NCUA staff gave enough to feed 55 people three meals a day for an entire year. NCUA’s 2014 donation of nearly 76 pounds of food per employee is 321 percent larger than the agency’s 2013 contribution of 22,068 pounds. NCUA’s 92,950-pound donation is the equivalent to the weight of six large African elephants, 21 Ford F-150 pickup trucks, 62 trees, 13,286 average newborn babies, or 245,156 iPhones.
“The results speak volumes about the types of people who work for NCUA: people who take initiative and care,” Matz said. “This year, NCUA’s staff not only set a new record in terms of the amount of food they donated, but they were very creative in coming up with ways to make the food drive engaging.”
This year’s food drive included several new teambuilding activities, including lunchtime tournaments like Cornhole, the popular bean-bag tailgating game, as well as door decorating competitions and a “CANstruction” contest, in which offices built structures with cans of food they collected.
Food banks around the country benefited from NCUA’s donations. For example, donations by employees in NCUA’s Central Office went to the Capital Area Food Bank (opens new window). The food bank serves more than 530,000 people per year, about 12 percent of the Washington, D.C., area’s population. Donations included whole-grain foods, canned fruits and vegetables, soups and stews, high-protein foods, baking goods and baby food.
NCUA’s Region V office, in Tempe, Arizona, led the agency by contributing 25,227 pounds of food. Staff in NCUA’s Office of Examination and Insurance made the largest contribution from the agency’s Central Office, 12,521 pounds, and the Office of Public and Congressional Affairs came in a close second with 12,238 pounds. Working as one group, the NCUA Board and Office of the Executive Director gave 5,299 pounds.
The agency’s largest single donor in 2014 was again Todd M. Harper, NCUA’s Director of Public and Congressional Affairs. Harper, who chaired this year’s food drive at NCUA, personally donated 6,070 pounds of food.
In all, 78 NCUA employees reached donation levels that qualified them for the Feds Feed Families Hall of Fame: 20 reached the Platinum level (1,000 pounds or more), 26 reached the Gold level (500–1,000 pounds), and 32 reached the Silver level (250–500 pounds).
The sixth annual Feds Feed Families food drive ran June 1–Aug. 27, 2014. During the first five years of the food drive, federal workers have collected 24.1 million pounds of food and other non-perishable items to support families across America.
ALEXANDRIA, Va. (Sept. 30, 2014) – The National Credit Union Administration today liquidated Republic Hose Employees Federal Credit Union of Youngstown, Ohio.
Member deposits are federally insured by the National Credit Union Share Insurance Fund. Administered by NCUA, the Share Insurance Fund insures individual accounts up to $250,000, and a member’s interest in all joint accounts combined is insured up to $250,000. The Share Insurance Fund separately protects IRA and KEOGH retirement accounts up to $250,000. The Share Insurance Fund has the backing of the full faith and credit of the United States.
NCUA’s Asset Management and Assistance Center will issue correspondence in the near future to individuals holding verified share accounts in the credit union. Members with additional questions about their insurance coverage may contact the Center toll-free at 877-715-0777 Monday through Friday between 9 a.m. and 6 p.m., Eastern. Individuals may also visit the MyCreditUnion.gov (opens new window) website at any time for more information about insurance coverage.
NCUA made the decision to liquidate Republic Hose Employees Federal Credit Union and discontinue operations after determining the credit union was insolvent and had no prospect for restoring viable operations.
Republic Hose Employees Federal Credit Union served 455 members and had assets of $581,487, according to the credit union’s most recent Call Report. Chartered in 1940, Republic Hose Employees Federal Credit Union served the employees of Republic Hose Manufacturing Corporation and Youngstown Steel Door Company and their immediate family members.
Republic Hose Employees Federal Credit Union is the eighth federally insured credit union liquidation in 2014.
ALEXANDRIA, Va. (Oct. 10, 2014) – The Texas Credit Union Department today liquidated County & Municipal Employees Credit Union of Edinburg, Texas, and named the National Credit Union Administration as liquidating agent.
Navy Army Community Credit Union of Corpus Christi, Texas, immediately assumed County & Municipal Employees Credit Union’s members, assets, shares and selected loans. Navy Army Community Credit Union is a federally insured, state-chartered credit union with assets of $2.1 billion and 131,990 members, according to the credit union’s most recent Call Report.
The new Navy Army Community Credit Union members should experience no interruption in services. Members with questions about share accounts should contact Navy Army Community Credit Union member services at 800-622-3631 Monday through Friday from 8:30 a.m. to 4:30 p.m., Central, and Saturdays from 9 a.m. to 1 p.m. The member services call center will be closed Monday, Oct. 13.
Accounts of the new Navy Army Community Credit Union members remain insured by the National Credit Union Share Insurance Fund. Administered by NCUA, the Share Insurance Fund insures individual accounts up to $250,000. A member’s interest in all joint accounts combined is insured up to $250,000. The Share Insurance Fund separately protects IRA and KEOGH retirement accounts up to $250,000. The Share Insurance Fund has the backing of the full faith and credit of the United States. Individuals may also visit the MyCreditUnion.gov (opens new window) website at any time for more information about their insurance coverage.
The Texas Credit Union Department made the decision to liquidate County & Municipal Employees Credit Union and discontinue operations after determining the credit union was insolvent with no prospect for restoring viable operations on its own.
Chartered in 1956, County & Municipal Employees Credit Union served employees of multiple political divisions and public service units as well as persons residing, working or worshiping in Hidalgo County, Texas. The credit union also operated branch offices in McAllen, Texas. County & Municipal Employees Credit Union had assets of $40.3 million and served 7,173 members, according to the credit union’s most recent Call Report.
County & Municipal Employees Credit Union is the ninth federally insured credit union liquidation in 2014.
Board Action Bulletin
ALEXANDRIA, Va. (Oct. 23, 2014) – The National Credit Union Administration Board convened its ninth scheduled open meeting of 2014 at the agency’s headquarters here today. The Board unanimously approved two items:
The Chief Financial Officer also briefed the Board on the performance of the National Credit Union Share Insurance Fund, which showed positive third-quarter results.
Credit Unions Will Not Pay a 2014 Share Insurance Fund Premium
The Share Insurance Fund ended the third quarter of 2014 with a net income of $24.6 million and an equity ratio of 1.30 percent. The equity ratio is calculated on an estimated insured share base of $895.7 billion and reflects the capitalization deposit adjustment billed in September.
“With the Share Insurance Fund on a sound footing, NCUA will not charge federally insured credit unions a premium in 2014,” NCUA Board Chairman Debbie Matz said. “The number of troubled credit unions continues to decline, and insurance losses remain manageable. Prudent regulation and supervision of a credit union system that continues to be strong and stable have kept the Share Insurance Fund at the maximum equity ratio permitted by law.”
Third-quarter investment and other income was $54 million; operating expenses were $48.1 million; and the provision for insurance losses was reduced by $18.7 million. Net income for the third quarter was $24.6 million. The third-quarter figures are preliminary and unaudited.
Shares in troubled credit unions, those rated CAMEL code 4 or 5, were 1.38 percent of federally insured credit union shares for the third quarter, an improvement compared to 1.46 percent in the second quarter. Also, for the third quarter:
The number of CAMEL code 4 and 5 credit unions fell 9.1 percent from the third quarter of 2013 to 288.
Assets of CAMEL code 4 and 5 credit unions were $14 billion, a 10.3 percent decline from the third quarter of 2013.
The number of CAMEL code 3 credit unions declined 2.2 percent from the third quarter of 2013 to 1,450.
Assets of CAMEL code 3 credit unions were $104.7 billion, a 3.4 percent decrease from the third quarter of 2013.
Four federally insured credit unions failed during the third quarter of 2014. Total year-to-date losses associated with credit union failures were $30.4 million, of which $28.6 million was related to fraud.
Board Approves Proposed Technical Amendments to Corporate Rule
Proposed technical amendments to the corporate credit unions rule (Part 704) approved by the NCUA Board would simplify and clarify several parts of the rule and facilitate compliance.
The housekeeping amendments do not undermine safeguards in the existing rule, which include investment restrictions and capital standards.
“To prevent a recurrence of the corporate crisis, the NCUA Board finalized substantive changes to the corporate rule four years ago,” Matz said. “The technical amendments we’re making today would clarify these rules and provide corporate credit unions a measure of regulatory relief. In particular, I strongly support the provision allowing surviving corporates to continue counting retained earnings acquired in mergers, which will remove a significant accounting hurdle and reduce future risks to the Share Insurance Fund.”
Board Approves Proposed Joint Agency Flood Insurance Rule Changes
NCUA joined four other federal agencies in approving a proposed rule to amend the regulation on lending in areas having special flood hazards (Part 760).
The proposed rule would establish requirements with respect to the escrow of flood insurance payments to be consistent with changes in the Homeowner Flood Insurance Affordability Act of 2014. The proposed rule also includes a new exemption no longer requiring separate flood insurance for certain detached structures.
The Office of the Comptroller of the Currency, the Federal Reserve Board of Governors, the Federal Deposit Insurance Corporation and the Farm Credit Administration have also approved the proposed rule.
NCUA tweets all open Board meetings live. Follow
@TheNCUA (opens new window) on Twitter, and access Board Action Memorandums and NCUA rule changes at
www.ncua.gov. NCUA also live streams, archives and posts
videos of open Board meetings online.
