Approved NCUA Budget Means Increases in Operating Fees
The National Credit Union Administration (NCUA) approved its 2019 and 2020 operating budgets. Coming in at $334.8 million in 2019 and $343.9 million for 2020, the budgets will see a 1.1 percent increase from 2018 and a 2.7 percent increase from 2019.
These budget amounts represent a total of three separate budgets, including:
1. NCUAâ€™s operating budget
2. Capital budget
3. Share Insurance Fund administrative budget
Along with the approval of the operating budgets, the Board decided to fund it with an overhead transfer rate (OTR) of 60.5 percent and increased operating fees by an average of two percent for natural-person credit unions with assets of more than $1 million.
Federal credit unions will fund 70.5 percent of NCUAâ€™s 2019 operating budget, leaving the other 29.5 percent to be covered by federally insurance, state-charted credit unions. Credit unions will be charged in March, with an April 17 due date.
Other topics of discussion in the Board meeting related to that of fidelity bonds. Soon headed into a 60-day comment period, this proposal aims to accomplish four objectives:
Strengthen oversight of fidelity bond coverage
Ensure an adequate period of time to discover and file covered claims following liquidations
Formalize a legal opinion that permits a natural-person credit union’s fidelity bond to include coverage for certain credit union service organizations (CUSOs)
Clarify the documents subject to the NCUA Board’s approval and require all bond forms receive the NCUA Board’s approval every 10 years.
Stayed tuned in with Doeren Mayhew for more information, as the NCUA Board moves the fidelity bond coverage proposal forward.