BOARD STREAMLINES TROUBLED
DEBT RESTRUCTURINGS
New Rule Helps Members Keep Their Homes,
Provides Credit Unions with Relief

3 Board Actions NCUA Finalizes Two Regulatory Relief Measures

4 Board Perspectives The Intersection of Innovation and Regulation Consistency/ Standardization

5 Credit Union Assets Top $1 Trillion

6 Seven Steps to Finding a Credit Union CEO

11 Free NCUA Training Events

Effective this month, the NCUA Board unanimously adopted a new final rule with policy guidance that will facilitate mortgage modifications to help economically distressed credit union members keep their homes.

The final loan workout rule and troubled debt restructurings (TDRs) policy is designed to provide credit unions with more flexibility to work with members unable to afford to make full payments on their original mortgages, if they agree to certain modified loan terms with their credit union.

“This rule demonstrates the value of maintaining open communication between NCUA and credit unions,” said NCUA Board Chairman Debbie Matz. “When a credit union volunteer told me that an NCUA policy was forcing them to foreclose on some financially distressed members who were seeking lower payments, it got our attention. After investigating the issue further, the Board committed to responsibly changing that outdated policy as quickly as possible.” Once the proposal was put out for comment, credit union officials across the country also joined the discussion, offering helpful suggestions for the final rule and policy guidance.

“As a result of this open dialogue, our final
rule sets no hard limit on the amount of
troubled loans that credit unions can work
out with members,” said Chairman Matz.
“And, in addition to benefiting
economically-distressed members, these
changes provide regulatory relief for credit
unions by removing unnecessary manual
tracking procedures, which will save credit
unions time and money.”
The changes adopted by the Board give
credit unions the ability to modify loans
without having to immediately classify TDRs
as delinquent. Specific changes include:
n Eliminating the dual and often manual
delinquency tracking burden on credit
unions for managing and reporting
TDR loans;
n Stipulating that credit unions need to
calculate the past due status of all loans
consistent with loan contract terms,