Regulatory Alerts2010-12-07 | I-10-05Added · Updated
Washington DFI Interpretive Letter I-10-05 on NCUA Regulatory Flexibility and Personal Guarantees for Member Business Loans
The Washington Department of Financial Institutions clarifies that the NCUA Regulatory Flexibility Program does not apply to state-chartered credit unions because it is not a requirement for federal deposit insurance. The letter further explains that while Washington's Member Business Loan rules do not mandate personal guarantees from principals, the Director considers obtaining them a safe and sound underwriting practice. Consequently, state-chartered credit unions are expected to secure personal guarantees for member business loans unless specific, rare circumstances justify a waiver.
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