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NCUA Supervisory Letter: Taxi Medallion Lending
Monday, April 7, 2014 7:00 AM

The National Credit Union Administration has issued a supervisory letter that provides examiners with guidance on evaluating credit unions engaged in taxi medallion lending. If your credit union makes taxi medallion secured loans, participates in these loans, or is contemplating doing so, the NCUA advices you to read its guidance.

“Taxi medallion lending is a valuable member service provided by certain credit unions with expertise in this form of member business lending which entails some unique risks,” writes NCUA Chair Debbie Matz. “Recently, market forces have contributed to a significant increase in medallion values in several major metropolitan markets.  As a result, credit unions that offer or participate in these loans can be exposed to increased risk.”

As Matz explains, the guidance will ensure NCUA continues to take a consistent approach to supervising credit unions engaged in taxi medallion lending.  In addition, the guidance provides information that will help credit unions manage the unique risks associated with taxi medallion loans.