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Adopted Regulations
Adoption of amendments to Parts 95, 96, 97 and 113 of the General Regulations of the Banking Board and new Parts 326 and 327 of the Superintendent's Regulations.


PART 95
BORROWINGS BY CREDIT UNIONS
(
Statutory Authority: Banking Law Section 454(9))

Section 95.2 is REPEALED.

PART 96
LENDING LIMITS FOR CREDIT UNIONS
(
Statutory Authority: Banking Law Section 454(6))

Section 96.1 is REPEALED.

A new Section 96.1 is added to read:

96.1 Definitions

For purposes of this Part:

  1. The term net worth shall have the same meaning as set forth in Section 702.2 of Part 702 of the Regulations of the National Credit Union Administration. In the event that a different definition of net worth is contained in that section, or in any successor section, or in any amendment to the Federal Credit Union Act, Part 96.1(a) shall be deemed to define net worth as set forth in such section or such law, as the case may be.

  2. The term loan shall mean any loan made to or guaranteed or endorsed by a member of a credit union.

Section 96.3 is amended to read:

96.3 Fully secured loans.

A credit union may make loans to a member which are secured by the borrower’s unhypothecated shares or by shares pledged by another member or members subject to the limitations contained in sections [453(5] 454{6) and [454(2)] 456(2) of the Banking Law.

PART 97
INVESTMENTS IN CREDIT UNION ORGANIZATIONS
(
Statutory Authority: Banking Law Section 454(19))  

Section 97.5 is amended to read:

97.5 Aggregate limitation

The aggregate amount of a credit union’s investment in the stock, capital notes and debentures of credit union organizations, together with the aggregate amount of loans to such organizations, shall not exceed [one] three percent of the amount due to the members of the credit union on shares and deposits. For the purposes of this section, a loan shall include any loan or advance made directly or indirectly to a credit union organization (excluding accounts payable incurred in the ordinary course of business and paid within 60 days).

PART 113
INVESTMENTS BY CREDIT UNIONS IN THE SHARES OF CENTRAL UNIONS LOCATED IN THIS STATE
(
Statutory Authority: Banking Law Section 454(8))  

Part 113 is REPEALED.

PART 326
MAINTENANCE OF RESERVES BY CREDIT UNIONS
(
Statutory Authority: Banking Law Section 458-a) 

326.1    Applicability.

The provisions of this Part shall apply to all net worth reserve accounts required to be established and maintained by credit unions.

326.2   Reserve Accounts.

Credit unions shall establish and maintain such net worth reserve accounts as are required for Federally chartered credit unions pursuant to Title 12 U.S.C.1790d and any regulations promulgated thereunder by the National Credit Union Administration, as such law and regulations may be amended from time to time.

326.2    Definition.

  1. The term net worth shall mean the retained earnings balance of the credit union at the end of a quarterly period as determined under generally accepted accounting principles. Retained earnings consists of undivided earnings, regular reserves, and any other appropriations designated by the management of a credit union or regulatory authorities. Only undivided earnings and appropriations of undivided earnings shall be included in net worth. Net Worth shall not include the allowance for loan and lease losses account. In the case of a credit union that qualifies to be designated as a low income credit union, net worth shall also include secondary capital accounts that are uninsured and subordinate to all other claims of creditors, shareholders and the National Credit Union Share Insurance Fund.

  2. In the event that a different definition of net worth is contained in 12CFR702.2 or any successor section, or in any amendment to the Federal Credit Union Act, this section shall be deemed to define net worth as set forth in such section or such law, as the case may be.

PART 327
INVESTMENTS BY CREDIT UNIONS IN THE SHARES OF CORPORATE CREDIT UNIONS LOCATED IN THIS STATE
(
Statutory Authority: Banking Law Section 454, 454(14)) 

Any credit union that seeks to invest in the shares of a state or Federal corporate credit union located in this state in an amount that exceeds fifty percent of its total capital or the insured limit, whichever is greater, shall give the Superintendent prior written notice of its intent to make such investment. If the Superintendent shall find that the proposed investment is consistent with the declaration of policy set forth in Section 10 of the Banking Law, he or she shall, within thirty days after receipt of such notice, notify the credit union in writing that such investment may be made or that an additional period of time, not to exceed sixty days, is required to properly make a determination.