NCUA: Voluntary Liquidations of Federal Credit Unions
•  The National Credit Union Administration (NCUA) Board has proposed a rule on the voluntary liquidations of federal credit unions (FCUs).
•  Chairman Matz noted at the February 2014 NCUA Board meeting that the proposed changes to the voluntary liquidations rule are intended to modernize the rule and factor in credit union growth since 1993, which was when the rule was last updated. NCUA staff believe there is about one voluntary liquidation of a federal credit union per year.
•  Specifically, the proposed rule would permit liquidating FCUs to publish required creditor notices in electronic media or newspapers of general circulation. In addition, the proposed rule would increase the asset size threshold for requiring multiple creditor notices, by exempting FCUs with less than $1 million in assets from the publication requirement, and exempting FCUs with less than $50 million in assets from the multiple publication requirement.
•  Further, the proposed rule would specify that preliminary partial distributions to members must not exceed insured account balances; specify when liquidating FCUs must determine member share balances for distribution purposes; and permit liquidating FCUs to distribute member share payouts either by wire or other electronic means, or by mail or personal delivery.
•  CUNA is interested in your comments on these proposed changes.
•  Comments for the proposed rule are due to NCUA by May 2, 2014; please submit your comments to CUNA by April 21, 2014.
•  If you have any questions or comments, please contact CUNA Assistant General Counsel Lance Noggle at [email protected].
•  For further details, please see NCUA’s proposed rule.