Regulatory Alerts2013-07-15 | I-13-04Interpretive Letter I-13-04 — Credit Union Owned Life Insurance
The Washington State Department of Financial Institutions issued revised guidance permitting state-chartered credit unions to purchase and hold life insurance products, including bank-owned life insurance, as an exercise of incidental powers. This authority is contingent upon adherence to risk management standards established by federal banking agencies and specific concentration limits, such as capping aggregate cash surrender value at 25% of net worth. The Director retains the discretion to preclude such purchases or compel divestment if practices are deemed unsafe or unsound for the credit union.
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