ALEXANDRIA, Va. – With the federal government shutdown, NCUA has issued a statement clarifying that it will remain open and reminding credit unions that they can remind their own members that individual accounts will remain federally insured during the shutdown.
“The government shutdown could affect credit unions, particularly those with federal employees in their memberships,” NCUA said.
NCUA also shared a link to an FAQ related to the National Flood Insurance Program (NFIP), below.
The agency added that credit unions should plan to respond to members’ questions and consider other actions, including:
- Ensuring policies provide flexibility to respond to members’ financial needs
- Preparing for service interruptions if the shutdown affects access to credit union offices located on federal property
- Prudently working with affected members, including providing advances to individuals receiving direct deposits from the federal government
- Developing contingency plans with respect to participation in government programs that may be affected by the federal government shutdown
- Communicating response plans to members, staff and volunteers in a timely manner.
Special Programs & Letter to CUs
The agency also stated that, “Consistent with safety and soundness, credit unions may want to consider offering special programs to assist impacted members who need short-term loans, create loans with special terms and rates, or offer payment flexibility.
The agency said credit unions should review NCUA’s Letter to Credit Unions, 11-CU-05, “Planning and Preparedness for a Potential Government Shutdown,” which provides guidance in the event of a government shutdown.
NFIP Update
NCUA joined with other agencies in issuing a statement that lenders that they may continue to make loans that are subject to the federal flood insurance statutes when the National Flood Insurance Program is not available. During this period, lenders are allowed to make these loans without requiring federal flood insurance, the agencies said.
“As explained in the Interagency Questions and Answers Regarding Flood Insurance, in Q&A Applicability 12, lenders may continue to make loans without flood insurance coverage during this time but must continue to make flood determinations; provide timely, complete, and accurate notices to borrowers; and comply with other applicable parts of the flood insurance regulations. In addition, lenders should evaluate safety and soundness,” the agencies stated.
