NCUA Releases Final Rule on Federally Insured Credit Union CUSOs

The National Credit Union Administration (NCUA) released its final rule addressing CUSO supervision during its board meeting in Washington, D.C., last week.

Under the final rule, CUSOs and their subsidiaries will be required to report information directly to the NCUA and state regulators, as applicable.  The final rule will take effect on June 30, 2014, and CUSOs will begin submitting reports after Dec. 31, 2015.

The final rule is targeted to CUSOs that offer complex or high-risk services such as credit and lending; information technology; and custody, safekeeping and investment management services.  These CUSOs must report more detailed information, including financial statements and general customer information.

Special requirements for a credit union investing in, lending to, or receiving services from the CUSO include reporting:

  • Services provided to each credit union;
  • The investment amount, loan amount, or level of activity of each credit union; and
  • The CUSO’s most recent year-end audited financial statements.

In addition, CUSOs engaging in credit and lending services will be required to report the following activity by loan type:

  • The total dollar amount of loans outstanding;
  • The total number of loans outstanding;
  • The total dollar amount of loans granted year-to-date; and
  • The total number of loans granted year-to-date.

Any subsidiary in which a CUSO has ownership interest in any amount will be subject to the rule if the subsidiary is primarily engaged in providing products or services to credit unions or their members.

Credit unions will need to update their written CUSO agreement to include the new requirements in the final rule.


Questions? Contact the Compliance Hotline: 1.800.546.4465,

Posted in Compliance News, NCUA.