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Free NCUA webinar to address liquidity CLF changes
ALEXANDRIA, Va. (8/2/12)--Pending Central Liquidity Facility (CLF) changes and the National Credit Union Administration's (NCUA) new proposed rule on emergency liquidity access will be discussed at a free Aug. 14 NCUA webinar announced by the agency Wednesday.

The webinar is scheduled to begin at 2 p.m. (ET) and will be hosted by NCUA Division of Capital Markets Director and CLF President Owen Cole.

The NCUA suggested that webinar participants review background information on the CLF before the webinar. Information on the CLF will be released to credit unions in an upcoming letter, the NCUA said.

Webinar participants may submit their questions for NCUA staff to WebinarQuestions@ncua.gov. The subject line should read "CLF and Your Credit Union's Contingent Liquidity," the agency said.

To register for the webinar, use the resource link.

More than 6,000 natural person credit unions will lose access to the CLF, which serves as a liquidity lender to credit unions in need of emergency funding, when U.S. Central Bridge Corporate CU closes in late October. In anticipation of this closing, the NCUA last month proposed a new emergency liquidity access rule.

The new proposal, which will remain open to public comment until Sept. 28, would require credit unions with less than $10 million in assets to maintain basic written emergency liquidity policies.

Federally insured credit unions (FICUs) with assets of $10 million or more would be required to develop contingency funding plans describing how their credit union would address liquidity shortfalls in emergency situations.

FICUs with assets of $100 million or more would be required to have access to a backup federal liquidity source for emergency situations.

The NCUA said these credit unions can ensure access to backup liquidity by:
  • Becoming a member of the CLF;
  • Becoming a CLF member through a CLF agent; or
  • Establishing direct borrowing access to the Federal Reserve's Discount Window.
The Credit Union National Association has urged the agency to use the guidance the federal financial agencies have already produced on liquidity issues, rather than release new rules. (See related July 25 News Now story: Troubled CU, liquidity rules 'unnecessary': CUNA)
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