Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

News Now

Washington
NEW: NCUA approves final derivatives investment rule
ALEXANDRIA, Va. (1/23/14, UPDATED: 11:20 A.M. ET)--A proposal that will allow well-run federal credit unions to use simple derivatives to hedge against interest rate risks has just been approved at today's National Credit Union Administration board meeting.

The NCUA plan would allow only well-managed credit unions with $250 million or more in assets to invest in derivatives.

The final rule includes key changes sought by the Credit Union National Association, such as removing the fees for supervision of the use of these products. CUNA in general has supported derivatives investments for credit unions.

There will not be an application fee for credit unions wishing to be approved for derivatives authority, and the rule will not apply to federally insured state credit unions.

The final rule addresses permissible derivatives and characteristics, limits on derivatives, operational requirements, counterpart and margining requirements, and the procedures a federal credit union must follow to apply for derivatives authority.

The supervisory costs will be covered by the National Credit Union Share Insurance Fund, the agency said. The NCUA has also budgeted $750,000 for 2014 and 2015 to cover related consulting costs.

Nearly 400 credit unions would be eligible to apply for derivatives investment authority, and the agency estimated that 30 to 60 credit unions would likely apply for the authority within the first two years of the program.

Watch News Now for more on today's open board meeting.
RSS print
News Now LiveWire
#NewsNow: Wal-Mart to issue EMV MasterCards within next few weeks. http://t.co/9csqwhFEdB
19 minutes ago
#UMich consumer confidence index bounces back in August http://t.co/LJ1l7mk4Ty
50 minutes ago
IPSOS survey: Canada's #creditunions top for member service 10th consecutive year @CanadianCentral http://t.co/dSipMd4qnz
1 hours ago
#NewsNow Home-state visits connect lawmakers, credit unions http://t.co/Ti7HdH9gFo
1 hours ago
#NewsNow: IOSCO head says the next major financial shock will come from a cyberattack. http://t.co/CrtMdYuTqY
1 hours ago