ALEXANDRIA, Va. -- NAFCU, CUNA and NASCUS have offered theirsuggestions and criticisms on a proposed NCUA rule that wouldinclude adding credit card loan origination and payroll processingservices to the list of permissible CUSO activities.

NCUA sought feedback on the proposal that would also lift arestriction that currently only allows FCUs to invest in or lend toCUSOs that primarily provide checking, currency and electronictransaction services to members so that the same services can beoffered to persons within the entire field of membership.

NAFCU suggested expanding the list of CUSO activities to alltypes of lending, real estate settlement services, employeesleasing services and support, purchase and servicing ofnonperforming loans, business counseling and referral andprocessing of loan applications for members that have been turneddown

Among its suggestions, CUNA said it is against requiring allFCUs with a net worth of less than 5% to seek prior approval fromNCUA to recapitalize an insolvent CUSO. Credit unions with 4%-5%net worth should only be required to provide prior notice to theagency, which NCUA could pursue if there are concerns, CUNAsaid.

NASCUS encouraged NCUA to work with state regulators to overseeCUSO issues, including access to books and records, "withoutadditional regulatory burden" to federally insured, state-charteredcredit unions.

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