ALEXANDRIA, Va. (12/6/13)--A final rule on charitable donation accounts will lead the day when the National Credit Union Administration holds its final open meeting of 2013 on Dec. 12.
The agency in September released a proposed rule that would permit credit unions to invest in hybrid charitable and investment vehicles known as charitable donation accounts (CDAs). These CDAs will allow federal credit unions to make investments that are otherwise prohibited, provided that the proceeds are primarily for charitable purposes.
The proposed rule would limit total investment in CDAs to 3% of the credit union's net worth for the duration of the accounts. A minimum of 51% of the total return from such an account would have to be distributed to one or more qualified charities. Distributions could be made to qualified charities no less frequently than every five years.
The Credit Union National Association approved of the NCUA proposal, which would "allow federal credit unions to do well by doing good." However, CUNA suggested some improvements that would facilitate credit union participation without raising safety and soundness concerns. Suggested changes included:
- Making CDA disbursements on an annual basis;
- Allowing corporate credit union to take part in CDAs; and
- Allowing credit unions to recover their costs so that these do not impact the total investment return.
Other items on the December open board meeting agenda include:
- A board briefing on a supplemental interagency rule on appraisals for higher-priced mortgage loans;
- A final rule that will make technical amendments to the corporate credit union rating system;
- The 2014 Temporary Corporate Credit Union Stabilization Fund oversight budget; and
- A proposed rule addressing requirements for federal credit union examination sites.
The Thursday open meeting is scheduled to begin at 10 a.m. (ET).
Supervisory activities, personnel issues and an appeal under Part 701.14(e) and Part 747, Subpart J of the NCUA's Rules and Regulations are on the closed board meeting agenda.
Parts 701.14 and 747 of NCUA regulations address senior executive officer changes.
For the full agenda, use the resource link.