ALEXANDRIA, Va.--NCUA Chairman Rodney Hood Monday issued a Letter to Credit Unions outlining a number of strategies CUs might consider when determining how to address the challenges associated with COVID-19.
The letter includes a list of frequently asked questions.
"The NCUA recognizes COVID-19 will impact credit unions and their members to varying degrees. I want to assure you that the NCUA is doing all we can to address the situation," stated Hood in the letter. "The health and safety of all NCUA staff, credit union staff, and credit union members are our paramount concern. We plan to take every step to ensure that our agency’s critical mission of protecting the safety and soundness of the credit union industry will continue to be executed as effectively and efficiently as possible. In addition, it is important to ensure credit unions can continue to meet, to the extent possible, the financial needs of their members. I encourage you to review previously issued NCUA guidance that addresses business continuity, hurricane, disaster, emergency, and pandemic planning and preparedness."
Hood said the agency encourages credit unions to work with affected borrowers.
"A credit union’s efforts to work with members in communities under stress may contribute to the strength and recovery of these communities," Hood said.
The chairman noted these efforts serve the long-term interests of impacted credit unions, and may include:
- Waiving ATM fees
- Increasing ATM daily cash withdrawal limits
- Waiving overdraft fees
- Waiving early withdrawal penalties on time deposits
- Waiving availability restrictions on insurance checks
- Easing restrictions on cashing out-of-state and non-member checks
- Easing credit terms for new loans for members who qualify
- Offering or expanding payday alternative loan programs
- Increasing credit card limits for creditworthy borrowers
- Waiving late fees for credit card and other loan balances
- Offering payment accommodations, such as allowing borrowers to defer or skip some payments, or extending the payment due dates, which would avoid delinquencies and negative credit bureau reporting caused by any COVID-19-related disruption
For the complete letter and FAQs, go to CUToday.info's The Gov here.
Former NCUA Chairman, NAFCU Respond
Former NCUA chairman Dennis Dollar called the letter "timely."
"Our credit union clients have been calling steadily the past few days seeking needed guidance on their annual membership meetings, board meetings and flexibility to work with members who are financially distressed during the current national emergency," said the Dollar Associates principal partner. "NCUA's guidance today was timely and in great demand. In particular, credit unions are pleased that NCUA has stated a willingness to give great latitude in conducting annual meetings when such gatherings have been prohibited and this is a legal and bylaws requirement."
NAFCU President and CEO Dan Berger said the trade association appreciates NCUA’s commitment to providing needed compliance relief in light of COVID-19.
"Many credit unions are already proactively helping their members weather the COVID-19 storm, and our industry will always be there to assist its membership when they need it most," said Berger. "We will continue to work with the NCUA to provide additional flexibility and guidance, specifically related to in-person annual meeting requirements, as the health and safety of credit union employees and members remains paramount.”