NCUA Board Approves Rare Investment Pilot Program
Samantha: Hello, this is Samantha Shares.
Happy new Year!
This episode covers National
Credit Union Administration Boardâs
Approval of a Non-Registered
Investment Fund Pilot Program
The following is an audio
version of that press release.
This podcast is educational
and is not legal advice.
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And now the press release.
NCUA Board Approves Non-Registered
Investment Fund Pilot Program
On December 30th The National Credit
Union Administration Board approved,
by notation vote, an investment pilot
program authorized under section 703
point 19 C of the N C U Aâs regulations.
The N C U A will permit up to 30
complex federal credit unions to
engage in investment activities
prohibited under part 703 but permitted
by the Federal Credit Union Act.
Note A credit union is considered
"complex" if its total assets exceed a
specific threshold set by the N C U A.
As of today,the threshold is 500
million dollars or more in total assets.
A L M First Financial Advisors, LLC.,
a Securities and Exchange Commission
registered investment advisor,
requested the investment pilot program.
The requested pilot program would
allow complex federal credit
unions to invest in a series of
non-registered investment funds
comprised of consumer loans, as follows:
The pilot fund would be comprised
of permissible consumer loans for
federally insured credit unions
with maturities of less than 10
years and overnight investments.
Federal credit unions must be complex and
have a capital adequacy classification
of well capitalized to invest in the fund
and are limited to an aggregate investment
of 50 percent of net worth as defined
in part 702 of N C U Aâs regulations.
The pilot program is subject to the A
L M First Loan Fund Investment Pilot
Program Requirements and Conditions, which
are available on the N C U A website.
Under part 703 of the N C U Aâs
regulations, federal credit unions
are authorized to invest in funds
that are registered with the S E C
or regulated by the Office of the
Comptroller of the Currency, provided
the underlying assets purchased by
the fund are permissible under N C
U A rules for federal credit unions.
This concludes the press release
If your Credit union could use assistance
with your exam, reach out to Mark Treichel
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This is Samantha Shares and
we Thank you for listening.
