ALEXANDRIA, Va.-Two months after NCUA informed 1,003 federal credit unions of their eligibility to become a low-income credit union (LICU), 676 federal credit unions have accepted, bringing the total list of LICUs to 1,874, the agency said.
The designation affords a number of special privileges, including being eligible for the Community Development Revolving Loan Fund grants and loans, the ability to obtain supplemental capital, being exempt from the 12.25% cap on member business loans and the ability accept non-member deposits from any source.
Bankers have decried NCUA's push to add more LICUs as an end run around the MBL cap established by Congress, but credit union advocates note that none of the credit unions that have been granted LICU status were even close to bumping up against the cap.
As a group, the newly designated LICUs serve more than 7.7 million members and manage more than $66 billion in combined assets, NCUA said. "We have had a very positive response to our low-income credit union eligibility initiative.
The initiative aims to put needed financial services and resources into the grassroots of the American economy," said NCUA Board Chairman Debbie Matz. "Two-thirds of the newly identified eligible credit unions have accepted in the last two months. By streamlining the application process, we are expanding opportunities and access to capital for millions of credit union members."
To qualify as a LICU, a majority of a credit union's membership must meet low-income thresholds based on 2010 Census data.