March 2, 1998
Ms. Mary Mortenson
Tel-Effective Communications, Inc.
1106 Second St., Suite 183
Encinitas, CA 92024
Dear Ms. Mortenson:
You have asked several questions about the ability of federal
credit unions (FCUs) to use brokers to obtain shares. NCUA does
not have a specific regulation in this area. An FCU may accept
brokered shares, as long as it does so consistent with the principles
of safety and soundness.
You have asked whether capital ratios are an issue and if there
are special reporting requirements for FCUs that accept brokered
shares. While there is no specific regulation governing these
matters, NCUA would be concerned about an FCU with a low capital
ratio or in troubled condition, see 12 C.F.R. �1.14,
accepting a significant amount of brokered shares.
You also have asked whether FCUs are authorized to receive share
certificates from banks or other depository institutions, with
or without the assistance of a share broker. Only an FCU with
a low-income designation from NCUA may receive shares from entities
other than members, public units, political subdivisions, or credit
unions. 12 U.S.C. �57(6); 12 C.F.R. Ё701.32,
701.34. The amount of nonmember deposits, including those of
public units, political subdivisions, and credit unions, that
an FCU may accept is limited to the greater of 20% of the FCU's
total shares or $1.5 million.
Sincerely,
Sheila A. Albin
Associate General Counsel
GC/LH:bhs
SSIC 3500
97-1250