ALEXANDRIA, Va. (5/23/08)—The National Credit Union Administration Thursday proposed amendments to its incidental powers regulation (Section 721) to clarify and update definitions of permissible activities in correspondent and operational programs, and finder activities.
One of the amendments would acknowledge that federal credit unions may provide correspondent services to foreign and federal or state-chartered credit unions. Another amendment would clarify that finder activities include a federal credit union's negotiation of group discounts, and the performance of administrative functions for outside vendors.
The NCUA set a 60-day comment period for the new rule.
"These amendments will provide useful information to federal credit unions by clarifying and updating the illustrations regarding permissible activities," the agency said.
The proposed amendment also would add language stating that vendors may provide non-financial products or financial products, including insurance.
The same proposal would add payroll services to the operational programs category. NCUA has already recognized in a 2006 legal opinion that payroll services are related to other permissible activities, such as electronic financial services and payroll deductions.
courtesy of cuna.org