ALEXANDRIA, Va.–The NCUA board has voted 3-0 to extend through year-end 2021 several regulatory relief measures put into place in response to the coronavirus pandemic.
Temporary Final Rule, Part 701, Regulatory Relief in Response to COVID-19 was approved by the board earlier this year. It includes a temporary final rule that:
- Raises the maximum aggregate amount of loan participations that a federally insured credit union may purchase from a single originating lender to the greater of $5,000,000 or 200% of the federally insured credit union’s net worth.
- Suspends limits on the eligible obligations that a federal credit union may purchase and hold.
- Due to physical distancing practices made necessary by COVID-19, tells the required timeframes for the occupancy or disposition of properties not being used for federal credit union business or that have been abandoned.
Hood Supports Proposal
The regulatory relief measures had been scheduled to expire on Dec. 31.
In response to a question from NCUA Chairman Rodney Hood, NCUA staff told the board loan participation activity has increased among credit unions, with nearly 50% of activity coming in the third quarter.
“It’s reasonable to assume these provisions have allowed credit unions to better manage liquidity,” said Hood.
Ongoing Pandemic Cited by Harper
NCUA Board Member Todd Harper noted that in the best-case scenario, forecasters predict the economy will return to its pre-pandemic output level by late 2021, though it will take much longer for employment to recover. For that reason, said Harper, he supported the extension.
“In supporting this temporary rule, I want to make clear that we would need to follow the normal rulemaking process of seeking public comment if we make any of these changes permanent,” Harper added. “The information obtained in any such rulemaking may affect my future views on the advisability and merit of these matters.”
New NCUA Board Member Kyle Hauptman, participating in his first NCUA board meeting, had no questions related to the extension and voted in favor.