NCUA Takes Next Step on Corporate Prepayment Plan, Schedules Free Webinar
July 6, 2011
July 7, 2011
The National Credit Union Administration (NCUA) on June 29 unanimously voted to move forward with a plan to allow credit unions, on a voluntary basis, to prepay their Corporate Stabilization Fund assessment, but made some changes to its original proposal.
The plan adopted would allow credit unions a choice to prepay some their Corporate Stabilization Fund assessment. The agency has set the target size of the program at $500 million, which will result in a reduction of the 2011 regular assessment from 24.9 basis points to 18.5 basis points.
If less than $500 million is committed, the NCUA will not implement the program.
If more than $500 is committed, prepayments from credit unions will be prorated so that the $500 million target will not be exceeded.
Credit unions may commit a maximum of 48 basis points of their total insured shares to the fund as of March 31, 2011. The agency previously proposed a maximum payment of 36 basis points.
Agency staff said that credit unions that do elect to participate in the plan would not be publicized. The amount that they have decided to pay into the prepayment fund would also not be publicized. However, that information will be made available on NCUA call reports once they are released later in the year.
The NCUA proposed the prepayment plan at its May open board meeting and accepted public comment on the proposal until June 20. The agency received a total of 184 comments on the proposal, with the majority of credit unions saying that they would participate in the plan.
The NCUA will be sending a letter to credit unions regarding the program and participating credit unions must provide completed program agreements, which the agency is providing with the letter and on its website by July 29. The NCUA will evaluate participation on August 9, and if the program goes forward will debit participating credit unions their proportional share on August 18. It will then determine the level of assessment needed for the Stabilization Fund in 2011.
Additionally, the NCUA will host a free webinar on the recently adopted Voluntary Prepayment of Corporate Stabilization Fund Assessments program Monday, July 11, at 11 a.m. PDT. Register for the webinar. This webinar will be archived on the NCUA website approximately two weeks after the event for those who cannot participate in the live session.
For technical questions related to accessing or registering for the webinar, or questions about the program, email firstname.lastname@example.org or call (703) 518-6337.
Questions? Contact the Compliance Hotline: 1.800.546.4465, email@example.com.
Posted in NCUA.