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NCUA: Interest Rate Ceiling Extended Through Sept. 10, 2018
Friday, February 24, 2017 6:45 AM

The National Credit Union Administration met yesterday for its February board meeting with an agenda that included a vote on the continuation of the Federal Credit Union Loan Interest Rate Ceiling and a quarterly update on the National Credit Union Share Insurance Fund. This meeting marks the first with Acting Chairman J. Mark McWatters presiding.

The NCUA Board voted in favor of the 18 percent loan interest rate cap, effective March 10, 2017 and extending through Sept. 10, 2018. The 18 percent cap applies to all federal credit union lending except NCUA's Payday Alternative Loan program, which remains at a 28 percent ceiling.

NCUA Chief Financial Officer Rendell Jones provided board members with the quarterly update noting that the Share Insurance Fund ended 2016 with a 1.24 percent equity ratio. At this time, no rebate is anticipated. The equity ratio is expected to increase to 1.27 percent in March. NCUA reported that no premium is expected at that time.

Total credit union failures in 2016 was 14 compared to 16 for the previous year. Fraud factored into ten of the 2016 failures, at a cost of $6.5 million. The number of CAMEL code 4 and 5 credit unions declined 10.9 percent to 196 at the end of 2016. In addition, CAMEL code 3, 4, and 5 credit unions have decreased 52.2 percent since reaching a high of $205.6 billion in Sept. 2010.

Review the presentation slides.