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Comment Letter Seeks FDIC Clarification

The Credit Union National Association (CUNA) is seeking clarification in a comment letter to the Federal Deposit Insurance Corporation (FDIC) that credit unions should not be covered under a new proposal the FDIC has issued regarding liquidation authority over entities engaging in financial activities.  The proposal was developed under Title II of the Dodd-Frank Act.  In the comment letter, CUNA emphasizes that credit unions should not be considered entities subject to the proposed definition of “predominantly engaged in activities that are financial in nature or incidental thereto” because Congress did not intend for the FDIC to exercise liquidating authority over credit unions. The “Ordinary Liquidating Authority” under Title II should only apply to “systemically risky” entities that did not previously have federal resolution authority, the letter states.