[Federal Register Volume 78, Number 247 (Tuesday, December 24, 2013)]
[Rules and Regulations]
[Pages 77563-77565]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-30557]


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NATIONAL CREDIT UNION ADMINISTRATION

12 CFR Parts 700, 701, and 704

RIN 3133-AE33


Technical Amendments

AGENCY: National Credit Union Administration (NCUA).

ACTION: Final rule.

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SUMMARY: The NCUA Board (Board) is making technical amendments to 
NCUA's regulations regarding the rating system for corporate credit 
unions. The technical amendments conform the regulations to a recent 
policy change adopted by the Board. Specifically, the policy change 
eliminates the use of the Corporate Risk Information System (CRIS) for 
corporate credit unions and replaces it with the CAMEL rating system. 
The technical amendments merely update the regulations to reflect the 
conversion from the CRIS to the CAMEL rating system for corporate 
credit unions.

DATES: The final rule is effective on January 1, 2014.

FOR FURTHER INFORMATION CONTACT: Lisa Henderson, Staff Attorney, Office 
of General Counsel, at 1775 Duke Street, Alexandria, VA 22314 or 
telephone: (703) 518-6540.

SUPPLEMENTARY INFORMATION: 

I. Background and Purpose of the Final Rule
II. Regulatory Procedures

I. Background and Purpose of the Final Rule

Why is the NCUA Board issuing this rule?

    In September 2013, the Board adopted a policy change which 
converted the

[[Page 77564]]

rating system for corporate credit unions from CRIS to CAMEL. The Board 
made this change to: (1) Improve rating comparability, as CAMEL is the 
standard rating system for natural person credit unions and banks; (2) 
reduce complexity in managing two different rating systems; (3) provide 
a uniform rating system to promote greater consistency in rating 
assignments; and (4) facilitate governance, as corporate credit union 
directors are familiar with CAMEL at their own natural person credit 
unions. The Board is now amending Sec. Sec.  700.2, 701.14, and 
704.4,\1\ which still reference the former CRIS rating system, to 
update them to reflect the current CAMEL rating system.
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    \1\ 12 CFR 700.2, 701.14, and 704.4.
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III. Regulatory Procedures

Regulatory Flexibility Act

    The Regulatory Flexibility Act requires NCUA to prepare an analysis 
to describe any significant economic impact a rule may have on a 
substantial number of small entities (primarily those under $50 million 
in assets). NCUA certifies that these technical amendments will not 
have a significant economic impact on a substantial number of small 
credit unions.

Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (PRA) applies to rulemakings in 
which an agency by rule creates a new paperwork burden on regulated 
entities or modifies an existing burden.\2\ For purposes of the PRA, a 
paperwork burden may take the form of either a reporting or a 
recordkeeping requirement, both referred to as information collections. 
NCUA has determined that the technical amendments in this final rule do 
not increase the paperwork requirements under PRA or regulations of the 
Office of Management and Budget.
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    \2\ 44 U.S.C. 3507(d); 5 CFR part 1320.
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Executive Order 13132

    Executive Order 13132 encourages independent regulatory agencies to 
consider the impact of their actions on state and local interests. 
NCUA, an independent regulatory agency as defined in 44 U.S.C. 3502(5), 
voluntarily complies with the executive order to adhere to fundamental 
federalism principles. This final rule will not have a substantial 
direct effect on the states, on the relationship 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 final rule does not constitute a policy that has 
federalism implications for purposes of the executive order.

Assessment of Federal Regulations and Policies on Families

    NCUA has determined that this final rule will not affect family 
well-being within the meaning of Section 654 of the Treasury and 
General Government Appropriations Act, 1999.\3\
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    \3\ Public Law 105-277, 112 Stat. 2681 (1998).
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Small Business Regulatory Enforcement Fairness Act

    The Small Business Regulatory Enforcement Fairness Act of 1996 \4\ 
(SBREFA) provides generally for congressional review of agency rules. A 
reporting requirement is triggered in instances where NCUA issues a 
final rule as defined by Section 551 of the Administrative Procedure 
Act.\5\ NCUA has submitted this rule to the Office of Management and 
Budget for it to determine if the final rule is a ``major rule'' for 
purposes of SBREFA. NCUA does not believe the rule is major.
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    \4\ Public Law 104-121, 110 Stat. 857 (1996).
    \5\ 5 U.S.C. 551.
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Final Rule

    Generally, the Administrative Procedure Act (APA) requires a 
federal agency to provide the public with notice and the opportunity to 
comment on agency rulemakings. The amendments in this rule are non-
substantive and technical. They make minor revisions to reflect the 
conversion to the CAMEL rating system for corporate credit unions. The 
APA permits an agency to forego the notice and comment period under 
certain circumstances, such as when a rulemaking is technical and non-
substantive. NCUA finds that, in this instance, notice and public 
comment are unnecessary under section 553(b)(3)(B) of the APA.\6\ NCUA 
also finds good cause to dispense with the 30-day delayed effective 
date requirement under section 553(d)(3) of the APA.\7\ The rule, 
therefore, will be effective January 1, 2014.
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    \6\ 5 U.S.C. 553(b)(3)(B).
    \7\ 5 U.S.C. 553(d)(3).
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List of Subjects

12 CFR Part 700

    Credit unions.

12 CFR Part 701

    Credit unions, Reporting and recordkeeping requirements.

12 CFR Part 704

    Corporate credit unions, Credit unions, Investments, Reporting and 
recordkeeping requirements.

    By the National Credit Union Administration Board on December 
12, 2013.
Gerard Poliquin,
Secretary of the Board.

    For the reasons discussed above, the NCUA Board amends 12 CFR parts 
700, 701, and 704 as follows:

PART 700--DEFINITIONS

0
1. The authority citation for part 700 continues to read as follows:

    Authority: 12 U.S.C. 1752, 1757(6), 1766.


0
2. Amend Sec.  700.2 by revising paragraph (2) of the definition of 
``Troubled Condition'' to read as follows:


Sec.  700.2  Definitions.

* * * * *
    Troubled condition means:
* * * * *
    (2) In the case of an insured corporate credit union:
    (i) A Federal credit union that has been assigned a 4 or 5 CAMEL 
rating by NCUA; or
    (ii) A federally insured, state-chartered credit union that has 
been assigned a 4 or 5 CAMEL rating by either NCUA, after an on-site 
contact, or its state supervisor; or
    (iii) A Federal credit union or a federally insured, state-
chartered credit union that has been granted assistance under section 
208 of the Federal Credit Union Act, 12 U.S.C 1788, that remains 
outstanding and unextinguished.
* * * * *

PART 701--ORGANIZATION AND OPERATION OF FEDERAL CREDIT UNIONS

0
3. The authority citation for part 701 continues to read as follows:

    Authority: 12 U.S.C. 1752(5), 1755, 1756, 1757, 1758, 1759, 
1761a, 1761b, 1766, 1767, 1782, 1784, 1786, 1787, 1789. Section 
701.6 is also authorized by 15 U.S.C. 3717. Section 701.31 is also 
authorized by 15 U.S.C. 1601 et seq.; 42 U.S.C. 1981 and 3601-3610. 
Section 701.35 is also authorized by 42 U.S.C. 4311-4312.


0
4. Revise Sec.  701.14(b)(4) to read as follows:


Sec.  701.14  Change in official or senior executive officer in credit 
unions that are newly chartered or are in troubled condition.

* * * * *
    (b) * * *
    (4) In the case of an insured corporate credit union, Troubled 
condition means:

[[Page 77565]]

    (i) A Federal credit union that has been assigned a 4 or 5 CAMEL 
rating by NCUA; or
    (ii) A federally insured, state-chartered credit union that has 
been assigned a 4 or 5 CAMEL rating by either NCUA, after an on-site 
contact, or its state supervisor; or
    (iii) A Federal credit union or a federally insured, state-
chartered credit union that has been granted assistance under section 
208 of the Federal Credit Union Act, 12 U.S.C. 1788, that remains 
outstanding and unextinguished.
* * * * *

PART 704--CORPORATE CREDIT UNIONS

0
5. The authority citation for part 704 continues to read as follows:

    Authority: 12 U.S.C. 1766(a), 1781, 1789.


0
6. Revise Sec.  704.4(d)(3)(ii) to read as follows:


Sec.  704.4  Prompt corrective action.

* * * * *
    (ii) Unsafe or unsound practice. NCUA has determined, after notice 
and an opportunity for hearing pursuant to paragraph (h)(1) of this 
section, that the corporate credit union received a less-than-
satisfactory CAMEL rating (i.e., three or lower) for any rating 
category (other than in a rating category specifically addressing 
capital adequacy) and has not corrected the conditions that served as 
the basis for the less than satisfactory rating. Ratings under this 
paragraph (d)(3)(ii) refer to the most recent ratings (as determined 
either on-site or off-site by the most recent examination) of which the 
corporate credit union has been notified in writing.
* * * * *
[FR Doc. 2013-30557 Filed 12-23-13; 8:45 am]
BILLING CODE 7535-01-P