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Federal, State Regulators Streamline LICU Process For State-Chartereds
ALEXANDRIA, Va. (2/21/13)--Federal and state regulators announced a joint plan Wednesday to streamline the process for state-chartered credit unions to determine if they are eligible for designation as low-income credit unions. (LICU).

Under a cooperative effort by the National Credit Union Administration and the National Association of State Credit Union Supervisors (NASCUS), state regulators can now provide limited geographic and income data to NCUA's AIRES system when they upload their examinations. AIRES stands for Automated Integrated Regulatory Examination Software.

The NCUA said it will use that data to determine if there are state-chartered credit unions eligible for the low-income designation and provide a list to state regulators on a quarterly basis of those credit unions. State regulators have the sole authority to make the LICU designation for state-chartered credit unions.

To qualify as a LICU, a majority of a credit union's membership must meet a low-income thresholds based on 2010 U.S. Census data. LICU designation has some regulatory benefits for credit unions.

For qualifying state-chartered credit unions, under certain circumstances and when state law permits, benefits can include: 
  • Eligibility for Community Development Revolving Loan Fund grants and low-interest loans;
  • Ability to obtain supplemental capital;
  • Exemption from the 12.25 percent statutory cap on member business loans; and
  • Ability to accept non-member deposits from any source.
"Consistency and cooperation are fundamental to effective regulation, and so is creating opportunities," NCUA Chairman Debbie Matz said in a release. "This is a great example of how state and federal regulators can work together to help state-chartered credit unions that qualify obtain a low-income designation. NCUA will provide state regulators with lists of credit unions that could qualify, and the states take it from there."

"Streamlining the process for federally insured, state-chartered credit unions that might seek the low-income credit union designation is a tangible benefit to the state system," NASCUS President/CEO Mary Martha Fortney added.


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