BOARD ACTIONS (FROM PAGE 3)

unions, thereby enhancing the provision of financial services for low-income households.

The rule improves definitions, clarifies eligibility requirements, adds examples of how credit unions can use loans from this fund, and significantly simplifies the current rule. Most significantly, the rule removes the requirement that NCUA charge an interest rate between 1 and 3 percent APRs. The Board intends this change to provide flexibility to charge a below-market APR no matter how low or how high the prevailing rates move in the future. The final rule also better details the application and award processes, and post-award reporting requirements.

The final rule will become effective Dec. 2, 30 days after publication in the Federal Register.

NCUSIF and Stabilization Fund: Financial
Conditions Steadily Improving

The NCUSIF equity ratio stood at 1.31 percent for Sept. 30, 2011. This ratio is calculated on an insured share base of $782.4 billion at June 30, 2011. The equity ratio will be recalculated at year end based upon the insured share base as of Dec. 31.

The NCUSIF ending reserve balance was $998.5 million. This figure included $22.5 million in reserves for specific natural-person credit unions, and $976.0 million in nonspecific reserves. Insurance loss expense was $217,000 during September.

Gross income for September was $18.4 million, with
expenses of $14.8 million, resulting in net income of $3.6
million. Cumulative net income for the year is $230.7 million.

Thirteen credit unions have failed thus far in 2011 at a cost to the NCUSIF of $45.8 million.

As of September, 384 federally insured credit unions with assets of $33.9 billion and shares of $30.4 billion had CAMEL code 4 or 5 designations. Additionally, 1,777 CAMEL code 3 credit unions had assets of $146.1 billion and shares of $129.8 billion.

Overall, approximately 18 percent of all credit union assets were in CAMEL code 3, 4 or 5 institutions. The percentage of assets in CAMEL code 1 and 2 credit unions has increased slightly in each of the past seven months, topping 82 percent as of Sept. 30.

The Stabilization Fund recorded revenue of $1.96 billion from the special premium assessment in September. Total liabilities and net position stood at approximately $8 billion at the end of September, about $2 billion higher than the end of August. The Stabilization Fund has $3.5 billion in outstanding U.S. Treasury borrowings.

Financial data reported in 2011 for both the NCUSIF and the Stabilization Fund are preliminary and unaudited.

All open NCUA Board meetings are tweeted live. Follow @TheNCUA on Twitter. Board Action Memorandums and NCUA rule changes are available online at www.ncua.gov.