7535-01-U

**NATIONAL CREDIT UNION ADMINISTRATION**

**12 CFR Parts 700, 704, 705, 707, 708b, 711, 713, 716, 723, 760, and
792**

**Technical Amendments**

**AGENCY:** National Credit Union Administration (NCUA).

**ACTION:** Final Rule.

**SUMMARY**: NCUA is amending a number of its regulations by making
minor technical corrections and grammatical changes. The amendments
delete duplicate words, add proper punctuations, and make other
grammatically necessary corrections. The amendments are intended to
provide helpful changes to NCUA\'s regulations.

**DATES**: This rule is effective \[INSERT DATE OF PUBLICATION IN THE
FEDERAL REGISTER\].

**FOR FURTHER INFORMATION CONTACT**: Justin M. Anderson, Staff Attorney,
Office of General Counsel, National Credit Union Administration, 1775
Duke Street, Alexandria, Virginia 22314-3428 or telephone: (703)
518-6540.\
\
**SUPPLEMENTARY INFORMATION**:\
\
**A. Background**\
In 2007, NCUA internally reviewed its regulations as part of a
publication process. NCUA used this opportunity to update and clarify
existing regulations. The 2007 review revealed that minor grammatical
revisions to certain regulations would be helpful.

**B. Regulatory Changes**

This rule provides minor grammatical changes and will not cause any
regulatory changes.

**C. Regulatory Procedures**

[Final Rule Under the Administrative Procedure Act]{.underline}

Generally, the Administrative Procedure Act (APA) requires a federal
agency to provide the public with notice and the opportunity to comment
on agency rulemakings. The amendments in this rule are not substantive
but technical in that they make minor corrections, merely provide
clarification or alert users of the regulations to other legal
requirements or limitations. The APA permits an agency to forego the
notice and comment period under certain circumstances, such as when a
rulemaking is technical and not substantive. NCUA finds good cause that
notice and public comment are unnecessary under Section 553(b)(3)(B) of
the APA. 5 U.S.C. 553(b)(3)(B). NCUA also finds good cause to dispense
with the 30-day delayed effective date requirement under Section
553(d)(3) of the APA. 5 U.S.C. 553(d)(3). The rule will, therefore, be
effective immediately upon publication.

[Regulatory Flexibility Act]{.underline}\
The Regulatory Flexibility Act requires NCUA to prepare an analysis to
describe any significant economic impact a rule may have on a
substantial number of small entities (those credit unions under ten
million dollars in assets). This rule provides minor, technical changes
to certain sections of NCUA's regulations. This rule will not have a
significant economic impact on a substantial number of small credit
unions, and, therefore, a regulatory flexibility analysis is not
required.

[Paperwork Reduction Act]{.underline}\
NCUA has determined that this rule will not increase paperwork
requirements under the Paperwork Reduction Act of 1995 and regulations
of the Office of Management and Budget.\
\
[Executive Order 13132]{.underline}\
Executive Order 13132 encourages independent regulatory agencies to
consider the impact of their actions on state and local interests. In
adherence to fundamental federalism principles, NCUA, an independent
regulatory agency as defined in [44 U.S.C.
3502](http://www.lexis.com/research/buttonTFLink?_m=6a971c9d890055e7a89186b5033192bb&_xfercite=<cite cc%3D"USA"><!%5BCDATA%5B66 FR 33211 %5D%5D><%2Fcite>&_butType=4&_butStat=0&_butNum=12&_butInline=1&_butinfo=44 USC 3502&_fmtstr=FULL&docnum=1&_startdoc=1&wchp=dGLbVtz-zSkAk&_md5=1c8323a9467e4b8f30a00da420ef71a6)(5),
voluntarily complies with the executive order. This rule will not have
substantial direct effects on the states, on the relationship between
the national government and the states, or on the distribution of power
and responsibilities among the various levels of government. NCUA has
determined that this rule does not constitute a policy that has
federalism implications for purposes of the executive order.\
\
[The Treasury and General Government Appropriations Act,
1999\--Assessment of Federal Regulations and Policies on
Families]{.underline}\
The NCUA has determined that this rule will not affect family well-being
within the meaning of section 654 of the Treasury and General Government
Appropriations Act, 1999, Pub. L. 105-277, 112 Stat. 2681 (1998).

[Small Business Regulatory Enforcement Fairness Act]{.underline}

The Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L.
104-121) (SBREFA) provides generally for congressional review of agency
rules. A reporting requirement is triggered in instances where NCUA
issues a final rule as defined by Section 551 of the APA. 5 U.S.C. 551.
The Office of Management and Budget has determined that this rule is not
a major rule for purposes of SBREFA. As required by SBREFA, NCUA will
file the appropriate reports with Congress and the General Accounting
Office so this rule may be reviewed.

**List of Subjects**

**12 CFR Part 700**

Credit unions.

**12 CFR Part 704**

Credit unions, Surety bonds.   

**12 CFR Part 705**

Community development, Credit unions, Loan programs-housing and
community development.

**12 CFR Part 707**

Advertising, Consumer protection, Credit unions, Reporting and
recordkeeping requirements, Truth in savings.

**12 CFR Part 708b**

Credit unions, Mergers of credit unions, Reporting and recordkeeping
requirements.

**12 CFR Part 711**

Credit unions.

**12 CFR Part 713**

Bonds, Credit unions, Insurance.

**12 CFR Part 716**

Bank deposit insurance, Consumer protection, Credit unions, Privacy.

**12 CFR Part 723**

Credit unions, Loan programs-business, Reporting and recordkeeping
requirements.

**12 CFR Part 760**

Credit unions, Flood insurance, Mortgages.

**12 CFR Part 792**

Confidential business information, Freedom of information, Government
employees, Privacy.

By the National Credit Union Administration Board on
\_\_\_\_\_\_\_\_\_\_\_\_\_, 2008.

> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> Mary Rupp\
> Secretary of the Board

For the reasons discussed above, NCUA is amending 12 CFR parts 700, 704,
705, 707, 708b, 710, 711, 713, 716, 723, 760, and 792 as follows:

**PART 700\-- DEFINITIONS**

1\. The authority citation for part 700 continues to read as follows:

**Authority:** 12 U.S.C. 1752, 1757(6), 1766.

2\. Section 700.2 is amended by removing the words \"means a State\" and
adding in their place the words \"means a state, and by removing the
word \"Territories\" and adding in its place the word \"territories\".

**PART 704 -- CORPORATE CREDIT UNIONS**

3\. The authority citation for part 704 continues to read as follows:

**Authority:** 12 U.S.C. 1766(a), 1781, 1789.

4\. Section 704.8(a)(4) is amended by removing the word \"and\" after
the phrase \"of this section;\".

**PART 705 -- COMMUNITY DEVELOPMENT REVOLVING LOAN PROGRAM FOR CREDIT
UNIONS**

5\. The authority citation for part 705 continues to read as follows:

**Authority:** 12 U.S.C. 1772C-1; 42 U.S.C. 9822 and 9822 note.

6\. Section 705.5(b)(1) introductory text is amended by revising the
last sentence to read as follows:

##### § 705.5   Application for participation.

\* \* \* \* \*

\(b\) \* \* \*

\(1\) \* \* \* A nonfederally insured credit union must include the
following:

\* \* \* \* \*

**PART 707 -- TRUTH IN SAVINGS**

7\. The authority citation for part 707 continues to read as follows:

**Authority:** 12 U.S.C. 4311.

8\. Section 707.8 is amended by revising paragraph (c)(5) to read as
follows:

##### § 707.8   Advertising.

\* \* \* \* \*

\(c\) \* \* \*

\(5\) *[Effect of fees]{.underline}*. A statement that fees could reduce
the earnings on the account.

\* \* \* \* \*

**PART 708b -- MERGERS OF FEDERALLY-INSURED CREDIT UNIONS; VOLUNTARY
TERMINATION OR CONVERSION OF INSURED STATUS**

9\. The authority citation for part 708b continues to read as follows:

**Authority:** 12 U.S.C. 1752(7), 1766, 1785, 1786, 1789.

10\. Section 708b.105(b) is amended by removing the word \"Part\" and
adding in its place \"part\" in the first sentence.

11\. Section 708b.203(e)(1) is amended by removing the duplicate word
\"it\" appearing after the words \"credit union that\".

12\. Section 708b.301 is amended as follows:

A. Paragraph (c) is amended by adding a period after the parenthetical
\"(Insert name of independent entity and address)\" in the first full
paragraph beginning with \"The credit union must\".

B. Paragraph (c) is further amended by removing the word \"accounts\"
and adding in its place the word \"account\" after the words \"if I use
different\" in the second full paragraph beginning with \"I understand
if\".

C. Paragraph (d)(5) is amended by removing the word \"inset\" and adding
in its place the word \"insert\" in the parenthetical following the
words \"a majority voted\" in the eighth paragraph beginning with
\"(insert \"20% or more\")\".

13\. Section 708b.302 is amended as follows:

A. Paragraph (c) is amended by removing the word \"accounts\" and adding
in its place the word \"account\" after the words \"if I use different\"
in the second full paragraph beginning with \"I Understand if\".

B. Paragraph (d)(5) is amended by removing the word \"and\" and adding
in its place the word \"an\" before the words \"entity independent\" in
the first full paragraph beginning with \"The (insert name)\".

C. Paragraph (d)(5) is further amended by removing the word \"inset\"
and adding in its place the word \"insert\" before the words \"in favor
of\" in the eighth paragraph beginning with \"(insert \"20% or
more\")\".

14\. Section 708b.303(b) is amended as follows:

A. Paragraph (b) is amended by revising the first sentence in the second
full paragraph to read as set forth below.

B. Paragraph (c)(5) is amended by removing the word \"and\" and adding
in its place the word \"an\" before the words \"entity independent\" in
the first sentence.

##### § 708b.303   Conversion of insurance through merger.

\* \* \* \* \*

\(b\) \* \* \*

I understand if the merger or conversion of the (insert name of merging
credit union) into the (insert name of continuing credit union) is
approved, the National Credit Union Administration share (deposit)
insurance I now have, up to \$100,000, or possibly more if I use
different account structures, will terminate upon the effective date of
the conversion. \* \* \*

\* \* \* \* \*

**PART 711 -- MANAGEMENT OFFICIAL INTERLOCKS**

16\. The authority citation for part 711 continues to read as follows:

**Authority:** 12 U.S.C. 1757 and 3201-3208.

17\. Section 711.2(j) is amended by removing the italicized phrase
\"*Low-and moderate-income*\" and adding in its place the italicized
phrase \"*[Low and moderate-income]{.underline}*\".

**PART 713 -- FIDELITY BOND AND INSURANCE COVERAGE FOR FEDERAL CREDIT
UNIONS**

18\. The authority citation for part 713 continues to read as follows:

**Authority:** 12 U.S.C. 1761A, 1761B, 1766(a), 1766(h), 1789(a)(11).

19\. Section 713.4(a) is amended by removing the words \"Web site\" and
adding in its place the word \"website\".

**PART 716 -- PRIVACY OF CONSUMER FINANCIAL INFORMATION**

20\. The authority citation for part 716 continues to read as follows:

**Authority:** 15 U.S.C. 6801 *et seq*., 12 U.S.C. 1751 *et seq*.

21\. Section 716.3(b)(2)(iii) is amended as follows:

A. Paragraph (b)(2)(iii) is amended by removing the italicized words
\"*web sites\"* and adding in their place the italicized word
\"*[websites\"]{.underline}* in the paragraph heading, removing the
words \"web site\" and adding in their place the word \"website\" in the
first sentence, and removing the word \"form\" and adding in its place
with the word \"from\" after the words \"not distract attention\" in the
first sentence.

B. Paragraph (e)(2)(iii) is amended by removing the parentheses from the
sentence that begins \"(The individual\" and ends with \"institutions
involved).\"

**PART 723---MEMBER BUSINESS LOANS**

22\. The authority citation for part 723 continues to read as follows:

**Authority:** 12 U.S.C. 1756, 1757, 1757A, 1766, 1785, 1789.

23\. Section 723.21 is amended as follows:

A. In the definition of [Construction or development loan]{.underline},
Example 4 is amended by removing the word \"incoming\" in the fourth
sentence and adding in its place the word \"income\". .

B. The definition of [Net worth]{.underline} is amended by removing the
phrase \"low income-designated\" and adding in its place the phrase
\"low-income designated\" in the fourth sentence.

**PART 760 -- LOANS IN AREAS HAVING SPECIAL FLOOD HAZARDS**

24\. The authority citation for part 760 continues to read as follows:

**Authority:** 12 U.S.C. 1757, 1789; 42 U.S.C. 4012a, 4104a, 4104b,
4106, and 4128.

25\. Section 760.7 is amended by removing the comma before the words
\"at any time during\" and adding a comma after the words \"not covered
by flood insurance\" in the first sentence.

**PART 792 -- REQUESTS FOR INFORMATION UNDER THE FREEDOM OF INFORMATION
ACT AND PRIVACY ACT, AND BY SUBPEONA; SECURITY PROCEEDURES FOR
CLASSIFIED INFORMATION**

26\. The authority citation for part 792 continues to read as follows:

**Authority:** 5 U.S.C. 301, 552, 552A, 552B; 12 U.S.C. 1752a(d), 1766,
1789, 1795f; E.O. 12600, 52 FR 23781, 3 CFR, 1987 Comp., p. 235; E.O.
12958, 60 FR 19824, 3 CFR, 1995 Comp., p. 333.

27\. Section 792.10(b) is amended by removing the words \"which meets\"
and adding in their place the words \"that meet\" in the third sentence.

28\. Section 792.16(a) is amended by adding a comma after the words
\"extends the time\" and removing the comma after the words \"with
written notice\" in the second sentence.

29\. Section 792.28 is amended by moving the period outside the
parenthetical \"(in case of partial denials)\" in the second sentence.

30\. Section 792.50(a) is amended by removing the parenthetical phrase
from the first sentence.

31\. Section 792.51(b) is amended by removing the words \"Personnel
Office\" wherever they appear in the fourth sentence and adding in their
place the words \"Office of Human Resources\".