[Federal Register Volume 59, Number 35 (Tuesday, February 22, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-3933]
[[Page Unknown]]
[Federal Register: February 22, 1994]
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NATIONAL CREDIT UNION ADMINISTRATION
12 CFR Parts 701 and 741
Organization and Operation of Federal Credit Unions and
Requirements for Insurance
AGENCY: National Credit Union Administration (NCUA).
ACTION: Notice of proposed rulemaking.
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SUMMARY: The proposed rule would amend NCUA's Regulations in order to
conform them to the new NCUA Fiscal and National Credit Union Share
Insurance Fund (NCUSIF) Insurance year. These changes to the fiscal and
insurance years were approved by the NCUA Board on November 15, 1993
and are effective January 1, 1995.
DATES: Comments must be postmarked by April 25, 1994.
ADDRESSES: Send comments to Becky Baker, Secretary of the Board,
National Credit Union Administration, 1775 Duke Street, Alexandria,
Virginia 22314-3428.
FOR FURTHER INFORMATION CONTACT:
Herbert S. Yolles, Controller, Office of the Controller, at the above
address or telephone: (703) 518-6570 or Mary F. Rupp, Staff Attorney,
Office of General Counsel, at the above address or telephone: (703)
518-6553.
SUPPLEMENTARY INFORMATION: The NCUA Board on November 15, 1993, voted
to change NCUA's fiscal year and NCUSIF's insurance year to coincide
with the calendar year effective January 1, 1995. This change requires
the NCUA to amend its regulations dealing with operating fees and
insurance assessments to conform to the calendar year.
Currently under Sec. 701.6 of NCUA's Rules and Regulations, an
operating fee is assessed on federal credit unions based on a fiscal
year of October 1 to September 30. This section must be changed to
reflect the change to the calendar year. Further, the operating fee
assessed as a result of a conversion or merger will now be based on the
calendar year and those sections must be changed to delete references
to the former fiscal year and reflect the new calendar year. 12 CFR
701.6(b) (2) and (3). The change will result in a transition quarter
that begins on October 1, 1994 and ends on December 31, 1994 for which
no operating fee would be assessed.
Currently under Sec. 741.11 of NCUA's Rules and Regulations, an
insurance premium and one percent deposit are assessed for all
federally insured credit unions based on an insurance year of July 1
through June 30. 12 CFR 741.11(b)(1). This definition must be amended
to reflect the change to the calendar year. Further, the due dates for
the deposits and premiums must be changed from January 31 to a date as
set by the NCUA Board in order to coincide with the calendar year. 12
CFR 741.11 (c), (d) and (g).
Regulatory Procedures
Regulatory Flexibility Act
The Regulatory Flexibility Act requires the NCUA to prepare an
analysis to describe any significant economic impact any regulation may
have on a potential number of small credit unions (primarily those
under $1 million in assets). Preliminary analysis concerning the effect
the proposed rule will have on small credit unions indicates that no
significant economic impact will result if the rule is promulgated in
final form by the NCUA Board. The proposed rule simply repeats the
preexisting requirements of federal credit unions to pay operating fees
and federally insured credit unions to pay one percent deposit and
insurance premiums with the only modification being the dates when
these fees and premiums must be paid. Therefore, the NCUA Board has
determined and certifies under the authority granted in 5 U.S.C. 605(b)
that the proposed rule, if adopted, will not have a significant
economic impact on a substantial number of small credit unions.
Accordingly, the NCUA Board has determined that a Regulatory
Flexibility Analysis is not required.
Paperwork Reduction Act
These amendments have no effect on paperwork requirements.
Executive Order 12612
Executive Order 12612 requires NCUA to consider the effect of its
actions on state interests. The proposed regulation dealing with
insurance premiums applies to all federally insured credit unions.
However, it makes no substantive changes except to change the dates for
certain filings and assessments of fees. The NCUA Board has determined
that this amendment is not likely to have any direct effect on states,
on the relationship between the states, or on the distribution of power
and responsibilities among the various levels of government because
federally insured credit unions are currently required to pay an
insurance premium.
List of Subjects
12 CFR Part 701
Civil rights, Conflicts of interest, Credit, Credit unions, Fair
housing, Insurance, Mortgages, Reporting and recordkeeping
requirements, Signs and symbols, Surety bonds.
12 CFR Part 741
Bank deposit insurance, Credit unions, Reporting and recordkeeping
requirements.
By the National Credit Union Administration Board on February
15, 1994.
Becky Baker,
Secretary of the Board.
Accordingly, NCUA amends 12 CFR parts 701 and 741 as follows:
PART 701--ORGANIZATION AND OPERATION OF FEDERAL CREDIT UNIONS
1. The authority citation for part 701 continues to read as
follows:
Authority: 12 U.S.C. 1752(5), 1755, 1756, 1757, 1759, 1761a,
1761b, 1766, 1767, 1782, 1784, 1787 and 1789. Section 701.6 is also
authorized by 31 U.S.C. 3717. Section 701.31 is also authorized by
15 U.S.C. 1601 et seq., 42 U.S.C. 1861 and 42 U.S.C. 3601-3610.
Section 701.35 is also authorized by 12 U.S.C. 4311-4312.
2. Section 701.6 is amended by revising paragraphs (a), (b) (2) and
(3) to read as follows:
Sec. 701.6 Fees paid by Federal Credit Unions.
(a) Basis for assessment. Each calendar year or as otherwise
directed by the Board, each Federal credit union shall pay to the
Administration for the current National Credit Union Administration
fiscal year (January 1 to December 31) an operating fee in accordance
with a schedule as fixed from time to time by the National Credit Union
Administration Board based on the total assets of each Federal credit
union as of December 31 of the preceding year or as otherwise
determined pursuant to paragraph (b) of this section.
(b) * * *
(1) * * *
(2) Conversions. A state chartered credit union that converts to
Federal charter will pay an operating fee in the year following the
conversion. Federal credit unions converting to state charter will not
receive a refund of the operating fee paid to the Administration in the
year in which the conversion takes place.
(3) Mergers. A continuing Federal credit union that has merged with
another credit union will pay an operating fee in the following year
based on the combined total assets of the merged credit union and the
continuing Federal credit union as of December 31. For purposes of this
requirement, a purchase and assumption transaction wherein the
continuing Federal credit union purchases all or essentially all of the
assets of another credit union shall be deemed a merger. Federal credit
unions merging with other Federal or state credit unions will not
receive a refund of the operating fee paid to the Administration in the
year in which the merger took place.
* * * * *
PART 741--REQUIREMENTS FOR INSURANCE
3. The authority citation for part 741 continues to read as
follows:
Authority: 12 U.S.C. 1757, 1766, and 1781-1790. Section 741.11
is also authorized by 31 U.S.C. 3717.
4. Section 741.11 is amended by revising paragraphs (b)(1), (c),
(d) and (g) to read as follows:
Sec. 741.11 Insurance premium and one per cent deposit.
* * * * *
(b) * * *
Insurance year means the period from January 1 through December 31.
* * * * *
(c) One percent deposit. Each insured credit union shall maintain
with the NCUSIF during each insurance year a deposit in an amount
equaling one percent of the total of the credit union's insured shares
as of the close of the preceding insurance year. The deposit shall be
adjusted annually on a date to be determined by the NCUA Board.
(d) Premium. Each insured credit union shall pay to the NCUSIF, on
a date to be determined by the NCUA Board, an insurance premium for
that insurance year in an amount equaling one twelfth of one percent of
the credit union's total insured shares as of the close of the
preceding insurance year.
* * * * *
(g) New charters. A newly-chartered credit union that obtains share
insurance coverage from the NCUSIF during the insurance year in which
it has obtained its charter shall not be required to pay an insurance
premium for that insurance year. The credit union shall fund its one
percent deposit on a date to be determined by the NCUA Board in the
following insurance year, but shall not participate in any distribution
from NCUSIF equity related to the period prior to the credit union's
funding of its deposit.
* * * * *
[FR Doc. 94-3933 Filed 2-18-94; 8:45 am]
BILLING CODE 7535-01-M
