ALEXANDRIA, Va. (2/16/09)--The National Credit Union Administration Friday announced it provided $2.9 billion this month to credit unions participating in the Credit Union System Investment Program (CU SIP), an NCUA initiative designed to add liquidity to the corporate credit union system. This follows the initial Jan. 9 issue when the NCUA’s Central Liquidity Facility (CLF) funded approximately $4.9 billion in advances under CU SIP. Under SIP, the CLF makes a secured, one year advance to the natural person credit union. The credit union must concurrently invest the amount of the advance in a fixed-rate, matched term, guaranteed note that is issued by the participating corporate. The SIP notes are guaranteed by the National Credit Union Share Insurance Fund. Corporate credit unions use the funds to retire borrowings from outside the credit union system. The CLF determines which corporates will issue the SIP notes to which credit unions. NCUA Chairman Michael Fryzel said in a release, “Stabilized liquidity is one of the cornerstones of NCUA’s approach to dealing with the difficulties in the corporate system, and I encourage credit unions to utilize this important tool as we move forward together.” The Credit Union National Association’s Corporate Credit Union Task Force has been investigating alternative funding approaches to reduce the costs to credit unions of funding the NCUA's corporate stabilization program. Included among them is a plan to seek modifications to the CU SIP program to make it more attractive to credit unions.