NCUA looking at new rules on underserved areas

ALEXANDRIA, Va. (5/23/08)---The National Credit Union Administration (NCUA) issued a 60-day comment period regarding proposed changes to the existing process of approving multiple group credit unions' service to underserved areas under the Chartering and Field of Membership Manual for Federal Credit Unions.

While the proposal is pending, NCUA has indicated that the 18 current applications for underserved areas would remain in the pipeline.

The proposal:

• Requests comments on whether a supporting letter should be necessary when a multiple group credit union seeks to add an underserved area;
• Would change the criteria for "economic distress" for determining if the community is an investment area so that it would be more compatible with the criteria used by the Community Development Financial Institutions Fund;
• Would also require a one-page narrative statement that describes significant unmet needs for loans or other financial services in the proposed area; and
• Would not apply to applications that already have been approved.

CUNA's Federal Credit Union Subcommittee will be reviewing the proposal and developing CUNA's comments.

courtesy of cuna.org