Colorado Division of Financial Services
Regulations 3.2, 4.2, 4.3, 6.2, 6.4 and 8.1
Pertaining to Credit Unions

Statement of Basis and Purpose

Proposed changes to the credit union regulations are as follows:

1.  Amend the following regulations to update the effective date of materials incorporated by reference. Regulations 4.2 Investments, 4.3 Incidental Powers, 6.2 Establishment and Maintenance of Credit Union Books and Records and 6.4 Fixed Assets incorporate by reference federal law, federal regulations and federal manuals. This promulgation incorporates these materials in effect as of July 13, 2012 and will not include amendments to these materials after this date.

2.  Amend Regulation 3.2 Small Groups, repeal the section denying additional small employer groups to credit unions receiving financial assistance from the National Credit Union Administration pursuant to 12 U.S.C. 1788.  The Division feels that it is arbitrary to predetermine if a small group may be advantaged by membership in a credit union.  The proposal also makes one technical language change suggested by the legal community.  This technical change or one similar is also proposed in Regulations 4.2 Investments and 6.4 Fixed Assets.

3.  Amend Regulation 4.3 Incidental Powers to clarify the language in paragraph (b).  This clarification was suggested by industry to remove the usage of a single term, “incidental powers”, for two separate authorities.

4.  Amend Regulation 6.2 to repeal and remove language that provided for conclusive proof of noncompliance with the regulation.  The legal community felt that this was too high a legal standard for the regulation and Division staff agrees.

5. Amend Regulation 6.4 Fixed Assets to remove the requirement for prior approval for any level of fixed assets.   The staff feels that this eliminates an unneeded regulatory burden.  

6. Amend Regulation 8.1 Report of Election or Appointment to conform to current practices and technology.  In the past, this information was mailed in hard copy to the Division within 20 days of elections or appointments of officials of credit unions.  There is currently a real time online database used by all NCUA insured credit unions that is the state of the art for maintaining this database.  This amendment simply would conform the regulation to current practice.

These regulations are being promulgated pursuant to C.R.S. 11-30-106(3) and 11-44-101.7(1)(b).