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Approvals & Notifications

The following information is provided as a service to North Carolina state-chartered credit union industry.

Approvals

Borrowing Limitation
04 NCAC 06C .0308
12 CFR §741.2

No credit union may borrow funds from any source in excess of 50 percent of its unimpaired capital without the written approval of the Administrator.

 

Branch Approval
NCGS §54-109.6

Credit unions who wish to open (purchase, lease, or build) a credit union branch location, must submit a Branch Application form that is inclusive of a business plan with a marketing plan and a 3-year performance plan. Also, include any contracts for purchase, leases, and upfitting and security installations for the desired location.

 

Bylaw Amendments
NCGS §54-109.4

Credit union bylaws prescribe the way in which bylaws may be amended.  Bylaw amendments must be approved in writing by the Administrator before they become effective.  Please complete and submit a Bylaw Amendment Application.

 

Commercial Lending Program
04 NCAC 06C .0407

The Board of Directors shall give notification to the Administrator prior to initiating a commercial lending and member business loan program and adopt specific commercial lending and member business loan policies and review them at least annually.  Credit unions with an asset size of two hundred fifty million dollars ($250,000,000) or below shall have commercial lending and member business loan policies submitted to the Administrator 30 days prior to initiating a commercial lending and member business loan program.

 

Conversion of Charter to North Carolina Charter
NCGS § 54-109.95
04 NCAC 06C .0208

Any state or federal credit union organized under applicable laws, may be converted to a North Carolina state-chartered credit union with the approval of the Administrator.

 

Core Processing Conversions
04 NCAC 06C .0301(c)
NCGS § 54-109.12

At least 60 days prior to conversion changes to Electronic Data Processing (EDP) services/core processing systems, a copy of the proposed contract and a description of the data processing system shall be submitted to the Administrator for review and approval.  If an in-house EDP system or the sponsoring company’s EDP facilities are to be used, the Administrator shall be notified in writing of the proposed change before planning and system programming begins.

 

Dividend Approval
04 NCAC 06C .0601

No dividend shall be declared or paid when the cost would exceed available earnings (negative year-to-date earnings) without prior written approval of the Administrator.  Please complete and submit a Dividend Request form by the 20th of the month in which you are scheduled to post the dividend.

 

Field of Membership Changes
NCGS § 54-109.4
04 NCAC 06C .0203

Field of membership changes require an amendment to the credit union’s bylaws.  Officials wishing to expand the field of membership must complete the Application for Field of Membership Expansion.  Field of membership removal requests require a completed Bylaw Amendment Application.

 

Foreign Credit Union
NCGS  § 54-109.106
12 CFR §741.11

A credit union organized under the laws of another state or territory of the United States may conduct business as a credit union in this State with the approval of the Administrator, provided North Carolina state-chartered credit unions are allowed to conduct business in the other state under similar provisions.  A Foreign Credit Union Branch Application must be completed by the foreign credit union.

 

Insurance, mutual funds, and fixed or variable annuity products
04 NCAC 06C .1202
NCGS § 54-109.82

Credit unions may deliver written application to the Administrator to make investments and purchase insurance, mutual funds and fixed or variable annuity products.  The Administrator shall promptly grant or deny the application within 60 calendar days following receipt with or without conditions or provisions, upon consideration of the following factors:

 

Loan Limitations
04 NCAC 06C .0403

No more than 30 percent of the total dollar amount of shares and deposits shall be made in fixed rate real estate loans with a remaining maturity of more than seven years without the permission of the Administrator.

 

Low Income Designation
12 CFR § 701.34

Each credit union wishing to obtain a low-income designation may request approval from the Administrator.  The designation will be made and reviewed by the Administrator on the same basis for federal credit unions.  Please contact the NCCUD for more information.

 

Management Changes
NCGS § 54-109.12
12 CFR § 741.205

A credit union that has been chartered for less than two years or meets the definition of troubled conditions must notify NCCUD and the NCUA in writing of any proposed changes in its board of directors, committee members, or senior executive staff.  The Administrator will approve or disapprove of the proposed individuals within 30 days of receiving the complete notification.  Credit unions should submit completed Notice of Change in Official or Senior Executive Officer forms to NCCUD and NCUA.

 

Mergers
NCGS § 54-109.94
04 NCAC 06C .0206

Officials wishing to pursue a merger opportunity should discuss the proposed merger with the Administrator or the Investigations and Chartering Manager prior to submitting the Merger Application Packet to secure tentative approval and authorization to proceed with the merger plans.  Any credit union may, with the approval of the Administrator, merge with another credit union subject to the rules and regulations set forth by the Administrator.

 

Name Changes

Officials wishing to change the name of the credit union must complete a Bylaw Amendment Application.  A North Carolina state-chartered credit union shall include the words “credit union” in its name.  Once approved by the Administrator, the change must be recorded with the Register of Deeds.

 

New Charter
NCGS § 54-109.2
04 NCAC 06C .0201
04 NCAC 06C .0203

Groups of interested persons desiring a North Carolina state-chartered credit union must complete a New Charter Packet.  Prior to filing an application with NCCUD, it is strongly recommended that the organizers of the proposed credit union meet with NCCUD staff to discuss the field of membership and operational concepts of the proposed credit union. A draft of the application package including a business plan should be completed prior to the meeting.

 

Operational Systems
04 NCAC 06C .0309

Credit unions, associations of credit unions, and any other parties interested in credit union programs may submit pilot programs relating to electronic funds transfer through remote service units, loan programs, and other operational systems to the Administrator for evaluation and approval.

 

Out of State Branches
04 NCAC 06C .0209
NCGS § 54-109.6

Before a credit union may open a branch office in another state, a written request shall be submitted to the Administrator for approval.

 

Sale of Loans
04 NCAC 06C. 0408

A credit union may not sell loans with recourse without the permission of the Administrator.

 

Use of Regular Reserve
NCGS § 54-109.87

The Regular Reserve shall belong to the credit union and shall be used to meet losses except those resulting from an excess of expenses over income and shall not be distributed except on liquidation of the credit union, or in accordance with a plan approved by the Administrator.

 

Share Draft Programs
04 NCAC 06C .0310

Share draft programs are permissible if provided for in the Credit Union bylaws or have otherwise been approved by the Administrator.

 

Signature Guarantee Program
04 NCAC 06C .1401

A credit union may offer its members signature guarantee services in connection with the transfer of securities, name change on a security certificate, replacement of lost certificates, or erasures on a security certificate provided they satisfy the conditions in 04 NCAC 06C .1401.  Credit unions must obtain the prior written approval of the Administrator before commencing its signature guarantee program.

 

Surety Bonds and Insurance Coverage
NCGS § 54-109.11(5)
04 NCAC 06C .0311
12 CFR § 713

No form of surety bond shall be used except as approved by the Administrator.  The approved bond forms for North Carolina state-chartered credit unions are Credit Union Blanket Bond 500 Bond Series, plus faithful performance rider, Credit Union Blanket Bond, Standard Form No. 23 of the Surety Association of America, or an equivalent Bond Form approved by the Administrator.  Minimum fidelity and faithful performance bond requirements and maximum deductible limits are defined in 04 NCAC 06C. 0311 and 12 CFR §713.

Notifications

Branch Closure Notification
NCGS §54-109.6

If you close an existing office, complete the Notification to Close a Branch form. If you are relocating the branch in the same county, you must notify the Administrator by completing the Notification to Close a Branch form. If the office is relocating to an existing branch in the same state, but moved out of the county, the change shall be recorded with the Register of Deeds of both counties. If the branch is relocating into a newly constructed, purchased, or leased facility, see the Branch Approval section.

 

Charitable Contributions and Charitable Donation Accounts
NCAC 06C .0708

A credit union may make charitable contributions and donations or may fund a charitable donation account. The credit union shall send written notice of the type and amount of initial investment to the Administrator 10 days prior to funding the Charitable Donation Account.

 

Conversion of Charter from North Carolina Charter
NCGS §54-109.95
04 NCAC 06C .0207

A North Carolina state-chartered credit union may be converted into another state or federal credit union if permitted by the other state or the Federal Credit Union Act and must be filed with the North Carolina Credit Union Division per regulations.

 

Hours of Operation
04 NCAC 06C .0307

Each credit union shall notify the Administrator of any changes to its days and hours of operations within 15 business days. Credit unions may provide the notification via their CU Online Profile.

 

Impairment of Capital
04 NCAC 06C.0501
NCGS §54-109.12

An impairment of capital shall exist if the credit union is unable to provide for Allowance for Loan Losses (Allowance for Credit Losses), or any other reserve required by the Administrator. Whenever it is determined that there exists an impairment of capital, the board of directors shall notify the Administrator.

 

Liquidation
NCGS §54-109.93

Within 10 days after the board of directors decides to submit the question of liquidation to the members, the president shall notify the Administrator thereof in writing, setting forth the reasons for the proposed action. Within 10 days after the members act on the question of liquidation, the president shall notify the Administrator in writing as to whether or not the members approved the proposed liquidation.

 

Liquidity Reserve
04 NCAC 06C .1301
NCGS §54-109.86

The liquidity reserve shall be determined monthly, not later than the tenth day of each month, and shall be based on the credit union's liability base as the last day of business of the preceding month. In the event the liquidity reserve falls below the required amount as set forth in G.S. §54-109.86, the credit union shall immediately notify the Administrator.

 

Management Changes
NCGS §54-109.36
04 NCAC 06C .0307

Each credit union shall notify the Administrator of the names and address of its officers, directors, members of the credit and supervisory committees, managers, and internal auditors. Officials should notify the Administrator of any changes to the information required within 15 business days. Credit unions may provide the notification via their CU Online Profile.