[Federal Register Volume 71, Number 124 (Wednesday, June 28, 2006)]
[Proposed Rules]
[Pages 36719-36720]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-5742]


=======================================================================
-----------------------------------------------------------------------

NATIONAL CREDIT UNION ADMINISTRATION

12 CFR Part 740

RIN 3133-AD18


Revisions to the Official Sign Indicating Insured Status

AGENCY: National Credit Union Administration (NCUA).

ACTION: Proposed rule with request for comments.

-----------------------------------------------------------------------

SUMMARY: NCUA proposes to revise the official sign indicating a credit 
union's share accounts are insured by the NCUA to reflect recent share 
insurance increases and by including a statement that NCUA-insured 
share accounts are backed by the full faith and credit of the United 
States Government. This proposal is required to comply with the Federal 
Deposit Insurance Reform Act of 2005 (Reform Act) and the Federal 
Deposit Insurance Reform Conforming Amendments Act of 2005 (Conforming 
Amendments Act).

DATES: Comments must be received on or before August 11, 2006.

ADDRESSES: You may submit comments by any of the following methods 
(Please send comments by one method only):
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     NCUA Web Site: http://www.ncua.gov/RegulationsOpinionsLaws/proposed_regs/proposed_regs.html. Follow 
the instructions for submitting comments.
     E-mail: Address to [email protected]. Include ``[Your 
name] Comments on Proposed Rule Part 740'' in the e-mail subject line.
     Fax: (703) 518-6319. Use the subject line described above 
for e-mail.
     Mail: Address to Mary Rupp, Secretary of the Board, 
National Credit Union Administration, 1775 Duke Street, Alexandria, 
Virginia 22314-3428.
     Hand Delivery/Courier: Same as mail address.
    Public Inspection: All public comments are available on the 
agency's Web site at http://www.ncua.gov/RegulationsOpinionsLaws/comments comments as submitted, except as may not be possible for technical 
reasons. Public comments will not be edited to remove any identifying 
or contact information. Paper copies of comments may be inspected in 
NCUA's law library at 1775 Duke Street, Alexandria, Virginia 22314, by 
appointment weekdays between 9 a.m. and 3 p.m. To make an appointment, 
call (703) 518-6546 or send an e-mail to OGC Mail @ncua.gov.

FOR FURTHER INFORMATION CONTACT: Frank Kressman, Staff Attorney, at the 
above address, or telephone: (703) 518-6540.

SUPPLEMENTARY INFORMATION:

A. Background

    The Reform Act and Conforming Amendments Act, respectively Pub. L. 
109-171 and Pub. L. 109-173, amended the share insurance provisions of 
the Federal Credit Union Act in a number of ways, including increasing 
share insurance coverage for certain accounts. 12 U.S.C. 1781-1790d. In 
March 2006, NCUA issued an interim final rule to implement many of 
those statutory amendments. 71 FR 14631 (March 23, 2006). Additionally, 
the Conforming Amendments Act also requires that NCUA's official sign, 
relating to the insurance of share accounts, include a statement that 
share accounts insured by NCUA, through the National Credit Union Share 
Insurance Fund, are backed by the full faith and credit of the United 
States Government. Section 740.4 of NCUA's regulations establishes the 
content and physical appearance of the official sign and dictates where 
insured credit unions must display the sign. This proposed rule amends 
Sec.  740.4 to comply with that statutory requirement and amends Sec.  
740.4 and Sec.  740.5 to reflect recent share insurance increases.
    The Conforming Amendments Act also imposes a penalty on an insured 
credit union that violates any statutory or regulatory provision 
related to the official sign. Specifically, an insured credit union is 
subject to a penalty of up to $100 a day for every day it is in 
violation of statutory or regulatory requirements. This proposed rule 
amends Sec.  740.4 to reflect this statutory provision.

B. Comment Period

    As a matter of agency policy, NCUA usually gives the public 60 days 
to comment on proposed rules. NCUA Interpretive Ruling and Policy 
Statement No. 87-2. In this instance, NCUA has determined that 50 days 
to August 11, 2006, is sufficient to allow all interested parties to 
comment given the nature and relative simplicity of this proposed rule. 
Additionally, this slightly shorter time period better enables NCUA to 
meet a statutory deadline for issuing this regulation.

C. Supply of New Signs and Compliance

    NCUA will provide all insured credit unions with an initial supply 
of the revised official sign with a blue background and white lettering 
at no cost to the credit unions and will make a downloadable graphic 
available on the agency Web site for credit unions to use on their Web 
sites. In the final rule and in a Letter to Credit Unions, NCUA will 
inform insured credit unions how and when they will receive their 
initial supply of revised official signs and set a reasonable period 
for insured credit

[[Page 36720]]

unions to comply with the rule's requirements to display the official 
sign. In any event, a credit union will not be considered in violation 
of Sec.  740.4 unless the credit union fails to display the revised 
signs after receiving them from NCUA and after a reasonable compliance 
period for making changes at teller windows, Web sites, and, if 
applicable, to advertisements. NCUA requests comment on whether a 
compliance date of 60 days after receiving the signs from NCUA would be 
a reasonable period for credit unions to come into compliance.

Regulatory Procedures

Regulatory Flexibility Act

    The Regulatory Flexibility Act requires NCUA to prepare an analysis 
to describe any significant economic impact a proposed rule may have on 
a substantial number of small credit unions (those under ten million 
dollars in assets). This rule clarifies that share accounts insured by 
NCUA are backed by the full faith and credit of the United States 
Government without imposing any additional regulatory burden. This rule 
would not have a significant economic impact on a substantial number of 
small credit unions, and, therefore, a regulatory flexibility analysis 
is not required.

Paperwork Reduction Act

    NCUA has determined that the proposed rule would not increase 
paperwork requirements under the Paperwork Reduction Act of 1995 and 
regulations of the Office of Management and Budget.

Executive Order 13132

    Executive Order 13132 encourages independent regulatory agencies to 
consider the impact of their actions on state and local interests. In 
adherence to fundamental federalism principles, NCUA, an independent 
regulatory agency as defined in 44 U.S.C. 3502(5), voluntarily complies 
with the executive order. The proposed rule would not have substantial 
direct effects on the states, on the connection between the national 
government and the states, or on the distribution of power and 
responsibilities among the various levels of government. NCUA has 
determined that this proposed rule does not constitute a policy that 
has federalism implications for purposes of the executive order.

The Treasury and General Government Appropriations Act, 1999--
Assessment of Federal Regulations and Policies on Families

    The NCUA has determined that this proposed rule would not affect 
family well-being within the meaning of section 654 of the Treasury and 
General Government Appropriations Act, 1999, Pub. L. 105-277, 112 Stat. 
2681 (1998).

Agency Regulatory Goal

    NCUA's goal is to promulgate clear and understandable regulations 
that impose minimal regulatory burden. We request your comments on 
whether the proposed rule is understandable and minimally intrusive.

List of Subjects in 12 CFR Part 740

    Advertisements, Credit unions.

    By the National Credit Union Administration Board on June 22, 
2006.
Mary F. Rupp,
Secretary of the Board.

    For the reasons discussed above, NCUA proposes to amend 12 CFR part 
740 as follows:

PART 740--ACCURACY OF ADVERTISING AND NOTICE OF INSURED STATUS

    1. The authority citation for part 740 continues to read as 
follows:

    Authority: 12 U.S.C. 1766, 1781, 1789.

    2. Section 740.4 is amended by revising the depiction of the 
official sign in paragraph (b) with the following depiction of the 
official sign and by adding new paragraph (f) to read as follows:


Sec.  740.4  Requirements for the official sign.

* * * * *
    (b) * * *
    [GRAPHIC] [TIFF OMITTED] TP28JN06.000
    
* * * * *
    (f) An insured credit union that fails to comply with Section 
205(a) of the Federal Credit Union Act regarding the official sign, 12 
U.S.C. 1785(a), or any requirement in this part is subject to a penalty 
of up to $100 per day.
    3. Section 740.5(c)(11) is amended by removing ``of $100,000'' and 
adding in its place ``insurance amount''.

[FR Doc. 06-5742 Filed 6-27-06; 8:45 am]
BILLING CODE 7535-01-P