This section of the FEDERAL REGISTER

contains notices to the public of the proposed

issuance of rules and regulations. The

purpose of these notices is to give interested

persons an opportunity to participate in the

rule making prior to the adoption of the final

rules.

Proposed Rules Federal Register

10872 

Vol. 86, No. 34 

Tuesday, February 23, 2021 

1Public Law 105–219, 112 Stat. 913 (1998). 

2 12 U.S.C. 1790d. 

3 12 U.S.C. 1790d(a)(1). 

4 12 CFR part 702; see also 65 FR 8584 (Feb. 18, 

2000) and 65 FR 44950 (July 20, 2000). 

5 80 FR 66626 (Oct. 29, 2015). 

6 83 FR 55467 (Nov. 6, 2018). 

7 65 FR 44950 (July 20, 2000). 

8The NCUA’s risk-based net worth requirement 

has been largely unchanged since its 

implementation, with limited exceptions: Revisions 

were made to the rule in 2003 to amend the riskbased net worth requirement for member business 

loans, 68 FR 56537 (Oct. 1, 2003); revisions were 

made to the rule in 2008 to incorporate a change 

in the statutory definition of ‘‘net worth,’’ 73 FR 

72688 (Dec. 1, 2008); revisions were made to the 

rule in 2011 to expand the definition of ‘‘low-risk 

assets’’ to include debt instruments on which the 

payment of principal and interest is 

unconditionally guaranteed by the NCUA, 76 FR 

16234 (Mar. 23, 2011); revisions were made in 2013 

to exclude credit unions with total assets of $50 

million or less from the definition of ‘‘complex’’ 

credit union, 78 FR 4033 (Jan. 18, 2013); and 

amendments were made in April 2020 to define 

loans made by credit unions under the Small 

Business Administration’s Paycheck Protection 

Program as ‘‘low-risk assets,’’ 85 FR 23212 (Apr. 27, 

2020). 

9 12 CFR 702.103. 

NATIONAL CREDIT UNION 

ADMINISTRATION 

12 CFR Part 702 

RIN 3133–AF21 

Risk-Based Net Worth—COVID–19 

Regulatory Relief 

AGENCY: National Credit Union 

Administration (NCUA). 

ACTION: Proposed rule. 

SUMMARY: The NCUA Board (Board) is 

issuing this proposal to raise the asset 

threshold for defining a credit union as 

‘‘complex’’ for purposes of being subject 

to any risk-based net worth requirement 

in the NCUA’s regulations. The 

proposed rule would amend the 

NCUA’s regulations to provide that any 

risk-based net worth requirement will 

be applicable only to a federally insured 

natural-person credit union (credit 

union) with quarter-end assets that 

exceed $500 million and a risk-based 

net worth requirement that exceeds six 

percent. The COVID–19 pandemic has 

created a vital need for financial 

institutions, including credit unions, to 

provide access to responsible credit and 

other member services to support 

consumers. Implementing this 

regulatory change in advance of January 

1, 2022, the effective date of the 2015 

final risk based capital (RBC) rule issued 

by the NCUA, would provide necessary 

capital relief to a significant number of 

credit unions without substantially 

decreasing the safety and soundness of 

credit unions or the National Credit 

Union Share Insurance Fund (NCUSIF). 

DATES: Comments must be received on 

or before March 25, 2021. 

ADDRESSES: You may submit written 

comments, identified by RIN 3133– 

AF21, by any of the following methods 

(Please send comments by one method 

only): 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the 

instructions for submitting comments. 

• Fax: (703) 518–6319. Include 

‘‘[Your Name]—Comments on RiskBased Net Worth—COVID–19 

Regulatory Relief’’ in the transmittal. 

• Mail: Address to Melane ConyersAusbrooks, Secretary of the Board, 

National Credit Union Administration, 

1775 Duke Street, Alexandria, Virginia 

22314–3428. 

Public Inspection: You may view all 

public comments on the Federal 

eRulemaking Portal at http://

www.regulations.gov as submitted, 

except for those we cannot post for 

technical reasons. The NCUA will not 

edit or remove any identifying or 

contact information from the public 

comments submitted. Due to social 

distancing measures in effect, the usual 

opportunity to inspect paper copies of 

comments in the NCUA’s law library is 

not currently available. After social 

distancing measures are relaxed, visitors 

may make an appointment to review 

paper copies by calling (703) 518–6540 

or emailing OGCMail@ncua.gov. 

FOR FURTHER INFORMATION CONTACT: 

Policy and Analysis: Kathryn Metzker, 

Risk Management Division, Office of 

Examination and Insurance, at (571) 

438–0073; Legal: Thomas Zells, Staff 

Attorney, Office of General Counsel, at 

(703) 518–6540; Rachel Ackmann, 

Senior Staff Attorney, Office of General 

Counsel, at (703) 548–2601; or by mail 

at: National Credit Union 

Administration, 1775 Duke Street, 

Alexandria, Virginia 22314. 

SUPPLEMENTARY INFORMATION: 

I. Introduction 

II. Legal Authority 

III. The Proposed Rule 

IV. Impact of the Proposed Rule 

V. Regulatory Procedures 

I. Introduction 

In 1998, Congress enacted the Credit 

Union Membership Access Act 

(CUMAA).1 Section 301 of CUMAA 

added section 216 to the Federal Credit 

Union Act (FCU Act),2 which required 

the Board to adopt by regulation a 

system of prompt corrective action 

(PCA) to restore the net worth of credit 

unions that become inadequately 

capitalized. The purpose of section 216 

of the FCU Act is to ‘‘resolve the 

problems of [federally] insured credit 

unions at the least possible long-term 

loss to the [NCUSIF].’’ 3 To carry out 

that purpose, Congress set forth a basic 

structure for PCA in section 216 that 

consists of three principal components: 

(1) A framework combining mandatory 

actions prescribed by statute with 

discretionary actions developed by the 

NCUA; (2) an alternative system of PCA 

to be developed by the NCUA for credit 

unions defined as ‘‘new;’’ and (3) a riskbased net worth requirement to apply to 

credit unions the NCUA defines as 

‘‘complex.’’ 

The Board initially implemented the 

required system of PCA in 2000,4

primarily in part 702 of the NCUA’s 

regulations, and most recently made 

substantial updates to the regulation in 

October 2015 5 and October 2018.6 The 

risk-based net worth requirement for 

credit unions meeting the definition of 

‘‘complex’’ was first applied on the 

basis of data in the Call Report reflecting 

activity in the first quarter of 2001.7 The 

NCUA’s risk-based net worth 

requirement has been largely unchanged 

since its implementation, with limited 

exceptions.8 Currently, the NCUA 

defines a credit union as complex and 

thus subject to the requirement only if 

the credit union has quarter-end assets 

that exceed $50 million and its riskbased net worth requirement exceeds 

six percent.9

As described more fully below, while 

the risk-based net worth requirement 

remains in place, the NCUA has issued 

multiple final rules to implement a 

requirement that utilizes an RBC ratio to 

replace the current requirement. The 

Federal Register / Vol. 86, No. 34 / Tuesday, February 23, 2021 / Proposed Rules 10873 

10 80 FR 66626 (Oct. 29, 2015). 

11See 12 U.S.C. 1782(c)(2)(A) (The FCU Act 

requires that each federally insured credit union 

pay a Federal share insurance premium equal to a 

percentage of the credit union’s insured shares to 

ensure that the NCUSIF has sufficient reserves to 

pay potential share insurance claims by credit 

union members, and to provide assistance in 

connection with the liquidation or threatened 

liquidation of federally insured credit unions in 

troubled condition.). 

12 83 FR 55467 (Nov. 6, 2018). 

13The risk-based net worth requirement currently 

in effect applies to a credit union only if it has 

quarter-end assets that exceed $50 million and its 

risk-based net worth requirement exceeds six 

percent. 

14 84 FR 68781 (Dec. 17, 2019). 

15The final rule provided several examples of 

issues the Board would consider during the delay, 

including asset securitization, subordinated debt, 

and a community bank leverage ratio analog. 

16Public Law 105–219, 112 Stat. 913 (1998). 

17 12 U.S.C. 1790d. 

18The risk-based net worth requirement for credit 

unions meeting the definition of ‘‘complex’’ was 

first applied on the basis of data in the Call Report 

reflecting activity in the first quarter of 2001. 65 FR 

44950 (July 20, 2000). 

19 12 U.S.C. 1790d(b)(1)(A); see also 12 U.S.C. 

1831o (Section 38 of the FDI Act setting forth the 

PCA requirements for banks). 

20 12 U.S.C. 1790d(b)(1)(B). 

21 12 U.S.C. 1790d(c). 

22 12 U.S.C. 1790d(o)(2). 

23 12 U.S.C. 1790d(o)(3). 

24 12 U.S.C. 1790d(c)–(g); 12 CFR 702.204(a)–(b). 

25For purposes of this rulemaking, the term ‘‘riskbased net worth requirement’’ is used in reference 

to the statutory requirement for the Board to design 

a capital standard that accounts for variations in the 

risk profile of complex credit unions. The term RBC 

is used to refer to the specific standards established 

Continued 

RBC requirement is based on the same 

provisions in the FCU Act, but uses 

different terminology and standards to 

distinguish it from the current riskbased net worth requirement. However, 

the effective date of the RBC 

amendments has been delayed until 

January 1, 2022, and the rule is 

currently undergoing a holistic review 

as part of that delay. Further, and of 

particular relevance to this proposed 

rule, the prospective RBC requirement 

applies only if a credit union’s quarterend total assets exceed $500 million, 

whereas the current risk-based net 

worth requirement applies if a credit 

union has quarter-end assets that exceed 

$50 million and its risk-based net worth 

requirement, as calculated under 

current part 702, exceeds six percent. 

As noted, at its October 2015 meeting, 

the Board issued a final rule (2015 Final 

Rule) to amend part 702 of the NCUA’s 

current PCA regulations to require that 

credit unions taking certain risks hold 

capital commensurate with those 

risks.10 The RBC provisions of the 2015 

Final Rule applied only to credit unions 

with quarter-end total assets exceeding 

$100 million. The overarching intent of 

the 2015 Final Rule was to reduce the 

likelihood that a relatively small 

number of high-risk outlier credit 

unions would exhaust their capital and 

cause large losses to the NCUSIF. Under 

the FCU Act, federally insured credit 

unions are collectively responsible for 

replenishing losses to the NCUSIF.11

The 2015 Final Rule restructures the 

NCUA’s current PCA regulations and 

makes various revisions, including 

amending the agency’s risk-based net 

worth requirement by replacing it with 

a new RBC ratio. The Board originally 

set the effective date of the 2015 Final 

Rule for January 1, 2019 to provide 

credit unions and the NCUA with 

sufficient time to make the necessary 

adjustments—such as systems, 

processes, and procedures—and to 

reduce the burden on affected credit 

unions. 

At its October 2018 meeting, the 

Board issued a final rule (2018 

Supplemental Rule) to delay the 

effective date of the 2015 Final Rule for 

an additional year, moving the effective 

date from January 1, 2019 to January 1, 

2020.12 Importantly, the 2018 

Supplemental Rule also amended the 

definition of ‘‘complex’’ credit union, 

adopted in the 2015 Final Rule for RBC 

purposes, by increasing the threshold 

level for coverage from $100 million to 

$500 million. Therefore, only credit 

unions with over $500 million in assets 

will be subject to the 2015 Final Rule.13

These changes provided these covered 

credit unions and the NCUA with 

additional time to prepare for the rule’s 

implementation, and exempted an 

additional 1,026 credit unions from the 

RBC requirements of the 2015 Final 

Rule without subjecting the NCUSIF to 

undue risk. 

In December 2019, the Board issued a 

final rule (2019 Supplemental Rule) to 

further delay the effective date of the 

2015 Final Rule an additional two years, 

until January 1, 2022.14 The Board 

issued the 2019 Supplemental Rule to 

allow the Board more time to 

holistically and comprehensively 

evaluate capital standards for credit 

unions 15 and provide covered credit 

unions and the NCUA with additional 

time to prepare for the 2015 Final Rule’s 

implementation. 

Under the 2019 Supplemental Rule, 

the NCUA’s current PCA regulation 

remains in effect until the 2015 Final 

Rule’s amended effective date, January 

1, 2022. The NCUA has enforced, and 

will continue to enforce, the capital 

standards currently in place and address 

any supervisory concerns through 

existing regulatory and supervisory 

mechanisms. Until that amended 

effective date, a credit union that would 

be exempted from any future RBC 

requirement because it does not have 

over $500 million in total assets remains 

subject to the current risk-based net 

worth requirement if it has over $50 

million in total assets and a risk-based 

net worth requirement that exceeds six 

percent. The Board now believes that 

this is an unnecessary restriction and is 

proposing to increase the threshold for 

defining a complex credit union for 

purposes of the current risk-based net 

worth requirement to $500 million to 

match the prospective RBC requirement 

while retaining the requirement that a 

credit union’s risk-based net worth 

requirement also exceeds six percent. 

This capital relief would enable credit 

unions to provide better service and 

more loans to their members. 

II. Legal Authority 

As discussed above, in 1998, Congress 

enacted CUMAA.16 Section 301 of 

CUMAA added section 216 to the FCU 

Act,17 which required the Board to 

adopt by regulation a system of PCA to 

restore the net worth of credit unions 

that become inadequately capitalized.18

Section 216(b)(1)(A) requires the Board 

to adopt by regulation a system of PCA 

for credit unions ‘‘consistent with’’ 

section 216 of the FCU Act and 

‘‘comparable to’’ section 38 of the 

Federal Deposit Insurance Act (FDI 

Act).19 Section 216(b)(1)(B) requires that 

the Board, in designing the PCA system, 

also take into account the ‘‘cooperative 

character of credit unions’’ (i.e., credit 

unions are not-for-profit cooperatives 

that do not issue capital stock, must rely 

on retained earnings to build net worth, 

and have boards of directors that consist 

primarily of volunteers).20 Among other 

things, section 216(c) of the FCU Act 

requires the NCUA to use a credit 

union’s net worth ratio to determine its 

classification among five ‘‘net worth 

categories’’ set forth in the FCU Act.21

Section 216(o) generally defines a credit 

union’s ‘‘net worth’’ as its retained 

earnings balance,22 and a credit union’s 

‘‘net worth ratio,’’ as the ratio of its net 

worth to its total assets.23 As a credit 

union’s net worth ratio declines, so does 

its classification among the five net 

worth categories, thus subjecting it to an 

expanding range of mandatory and 

discretionary supervisory actions under 

PCA.24

Section 216(d)(1) of the FCU Act 

requires that the NCUA’s system of PCA 

include, in addition to the statutorily 

defined net worth ratio requirement 

applicable to credit unions, ‘‘a riskbased net worth 25 requirement for 

10874 Federal Register / Vol. 86, No. 34 / Tuesday, February 23, 2021 / Proposed Rules 

in the 2015 Final Rule to function as criteria for the 

statutory risk-based net worth requirement. The 

term ‘‘risk-based capital ratio’’ is also used by the 

other Federal banking agencies and the 

international banking community when referring to 

the types of risk-based requirements that are 

addressed in the 2015 Final Rule. This change in 

terminology has no substantive effect on the 

requirements of the FCU Act, and is intended only 

to reduce confusion for the reader. 

26 12 U.S.C. 1790d(d)(1). 

27 12 U.S.C. 1790d(d). 

28 Id. 

29See the 2015 Final Rule and 2018 

Supplemental Rule for reasons the NCUA believes 

a single asset-size threshold is appropriate for 

determining whether a credit union is complex for 

purposes of prompt corrective action. See 80 FR 

66626 (Oct. 29, 2015) and 83 FR 55467 (Nov. 6, 

2018). 

30The 2015 Final Rule and 2018 Supplemental 

Rule both used a complexity index, however the 

original complexity index used in the 2015 Final 

Rule was amended in the 2018 Supplemental Rule. 

The 2018 Supplemental Rule used a revised 

complexity index that amended six of the indicators 

in the original complexity index so the index more 

accurately reflected ‘‘complexity’’ in credit unions 

and took into account certain regulatory changes 

that were made after the 2015 Final Rule was 

approved. 

31This was based on available data at the time of 

the 2018 Supplemental Rule. 

insured credit unions that are complex, 

as defined by the Board.’’ 26 The FCU 

Act directs the NCUA to base its 

definition of ‘‘complex’’ credit unions 

‘‘on the portfolios of assets and 

liabilities of credit unions.’’ 27 It also 

requires the NCUA to design a riskbased net worth requirement to apply to 

such ‘‘complex’’ credit unions.28

In addition to the specific regulatory 

authority provided to the NCUA by the 

above-referenced statutory provisions of 

the FCU Act, the FCU Act also grants 

the NCUA broad plenary rulemaking 

authority. 

III. The Proposed Rule 

The COVID–19 pandemic has created 

a vital need for financial institutions, 

including credit unions, to provide 

access to responsible credit and other 

member services to support consumers. 

The Board is working with Federal and 

state regulatory agencies, in addition to 

credit unions, to assist credit unions in 

managing their operations and to 

facilitate continued assistance to credit 

union members and communities 

impacted by the coronavirus. As part of 

these ongoing efforts, the Board is 

proposing to raise the asset threshold for 

defining a credit union as ‘‘complex’’ for 

purposes of the current risk-based net 

worth requirement. Under the proposal, 

any risk-based net worth requirement 

would be applicable to only a credit 

union with quarter-end assets that 

exceed $500 million whose risk-based 

net worth requirement also exceeds six 

percent. This would remain in place 

until the effective date of the abovereferenced RBC rule. The Board believes 

that this increase would provide 

necessary relief to a significant number 

of credit unions and their members 

without substantially increasing the risk 

to credit unions or the NCUSIF, 

consistent with the NCUA’s 

responsibility to maintain the safety and 

soundness of the credit union system. 

The NCUA seeks to strike the 

appropriate balance between providing 

for the safety and soundness of the 

credit union industry, while not 

restricting credit union activities by 

requiring a credit union to hold 

excessive levels of capital. Requiring a 

credit union to hold excess capital 

above what is necessary to account for 

risk limits its ability to increase lending 

or provide necessary services to 

members. Specifically, potential 

consequences of the higher capital 

requirements include: Reduced or 

higher-cost lending, limited products, 

higher compliance cost, and increased 

merger activity. 

In 2018, the NCUA determined that 

increasing the applicability threshold 

for RBC to $500 million did not pose 

undue risk to the NCUSIF because 

credit unions with assets greater than 

$500 million account for the majority of 

industry assets (both total assets and 

complex assets, as explained below). 

Based on September 30, 2020 data, 

credit unions with assets between $50 

million and $500 million account for 

15.9 percent of industry assets and 33.8 

percent of credit unions. The average 

asset size of a credit union in this cohort 

is $164 million. Conversely, credit 

unions with assets greater than $500 

million account for 81.6 percent of 

industry assets and only 12.4 percent of 

total credit unions. Therefore, raising 

the risk-based net worth requirement 

threshold to $500 million would still 

cover the majority of assets in the credit 

union system and not pose undue risk 

to the NCUSIF for the same reasons that 

the Board found in the 2018 

Supplemental Rule. In the 2015 Final 

Rule and 2018 Supplemental Rule, the 

NCUA determined a credit union was 

complex by evaluating whether its 

portfolios of assets and liabilities were 

complex based on the products and 

services in which such credit unions 

engaged. An asset size threshold was 

developed as a proxy measure based on 

a detailed analysis performed by the 

NCUA.29 The threshold set forth a clear 

demarcation line, above which the 

NCUA determined all credit unions 

engaged in complex activities, and 

where almost all such credit unions 

were involved in multiple complex 

activities. 

The asset threshold adopted in the 

2015 Final Rule and revised in the 2018 

Supplemental Rule for determining 

whether a credit union is complex was 

based on a complexity index.30 The 

2018 Supplemental Rule also used a 

complexity ratio, a ratio of complex 

assets and liabilities to total assets, to 

evaluate the extent to which credit 

unions are involved in complex 

activities. The 2018 Supplemental Rule 

noted that of the $497 billion in 

complex assets and liabilities in the 

credit union system, $423 billion (85 

percent)—the majority of complex assets 

and liabilities in the credit union 

system—are held among credit unions 

with more than $500 million in assets.31

In general, two-thirds of credit unions 

with more than $500 million in total 

assets had complex assets and liabilities 

ratios above 30 percent. Only 11 percent 

of credit unions with less than $500 

million had complexity ratios above 30 

percent. 

Using both the revised complexity 

index and the complexity ratio, the 2018 

Supplemental Rule noted the $500 

million threshold for defining complex 

credit unions would not represent 

undue risk to the NCUSIF as 

approximately 76 percent of the assets 

held by federally insured credit unions 

would still be covered. As noted above, 

credit unions with assets above $500 

million represent 81.6 percent of 

industry assets as of September 30, 

2020. 

The Board believes this change would 

provide relief to many credit unions and 

help to maintain confidence in the 

system of cooperative credit, consistent 

with the NCUA’s mission. 

IV. Impact of the Proposed Rule 

Increasing the complexity threshold 

to $500 million would provide potential 

relief to 1,737 credit unions. While all 

complex credit unions meet their riskbased net worth requirement as of 

September 30, 2020, because their net 

worth ratio exceeds their risk-based net 

worth requirement, immediate capital 

relief can be provided to some of these 

credit unions. As shown in Table 1, 

there are 94 complex credit unions with 

assets totaling $66 billion which are 

required to hold capital above 7 percent 

to be well capitalized based on their 

risk-based net worth requirement. Of the 

94 credit unions, 67 have assets less 

than $500 million and would no longer 

be required to hold more capital to 

remain well capitalized. Additionally, 

increasing the complexity threshold 

now rather than when the 2015 Final 

Rule goes into effect will not pose 

Federal Register / Vol. 86, No. 34 / Tuesday, February 23, 2021 / Proposed Rules 10875 

32This reflects the current threshold for complex 

credit unions. 

33This reflects the proposed threshold for 

complex credit unions. 

34This would reduce the amount of capital they 

are required to hold to be well capitalized by $82 

million in aggregate, based on September 30, 2020 

data. 

35Because of the straightforward nature of the 

proposed change and the extensive comment period 

offered on the various RBC rulemakings, the Board 

is not providing the usual 60-day comment period. 

See NCUA Interpretive Ruling and Policy Statement 

(IRPS) 87–2, as amended by IRPS 03–2 and IRPS 

15–1. 80 FR 57512 (Sept. 24, 2015), available at 

https://www.ncua.gov/files/publications/irps/ 

IRPS1987-2.pdf. 

undue risk to the NCUSIF as the 67 credit unions provided relief represent 

less than 1 percent of industry assets. 

TABLE 1—COMPLEX CREDIT UNIONS WITH A RISK BASED NET WORTH REQUIREMENT GREATER THAN 7 PERCENT

Asset category Number of 

credit unions 

Total assets 

(million) 

Percent of 

industry assets 

Assets >$50M 32 .......................................................................................................................... 94 $66.0 3.7 

Assets >$500M 33 ........................................................................................................................ 27 54.6 3.1 

$50M< Assets <$500M ................................................................................................................ 67 11.4 0.6 

Therefore, this proposed rule would 

provide immediate relief for the 67 

credit unions that must currently 

manage their capital levels to a riskbased net worth requirement above 

seven percent.34 Additionally, it would 

also provide relief to all credit unions 

with assets between $50 million and 

$500 million, which would be able to 

expand their portfolios and simply 

manage their capital levels to meet the 

seven percent leverage requirement to 

be well capitalized. 

The NCUA invites comments on all 

aspects of the proposal.35

V. Regulatory Procedures 

A. Regulatory Flexibility Act (RFA) 

The Regulatory Flexibility Act (RFA) 

generally requires that, in connection 

with a notice of proposed rulemaking, 

an agency prepare and make available 

for public comment an initial regulatory 

flexibility analysis that describes the 

impact of a proposed rule on small 

entities. A regulatory flexibility analysis 

is not required, however, if the agency 

certifies that the rule will not have a 

significant economic impact on a 

substantial number of small entities 

(defined for purposes of the RFA to 

include federally insured credit unions 

with assets less than $100 million) and 

publishes its certification and a short, 

explanatory statement in the Federal 

Register together with the rule. The 

proposed rule would only exempt 

additional credit unions from any riskbased net worth requirement in part 702 

of the NCUA’s regulations applicable to 

complex credit unions. As a result, it 

will not cause any increased burden on 

credit unions and will not have an 

impact on small credit unions. 

Accordingly, the NCUA certifies that the 

proposed rule will not have a significant 

economic impact on a substantial 

number of small credit unions. 

B. Paperwork Reduction Act 

The Paperwork Reduction Act of 1995 

(PRA) applies to rulemakings in which 

an agency by rule creates a new 

paperwork burden on regulated entities 

or modifies an existing burden (44 

U.S.C. 3507(d)). For purposes of the 

PRA, a paperwork burden may take the 

form of a reporting, recordkeeping, or a 

third-party disclosure requirement, 

referred to as an information collection. 

The NCUA may not conduct or sponsor, 

and the respondent is not required to 

respond to, an information collection 

unless it displays a valid Office of 

Management and Budget (OMB) control 

number. This proposed rule contains no 

provisions constituting a collection of 

information under the Paperwork 

Reduction Act of 1995 (44 U.S.C. et 

seq.). 

C. Executive Order 13132 

Executive Order 13132 encourages 

independent regulatory agencies to 

consider the impact of their actions on 

state and local interests. The NCUA, an 

independent regulatory agency as 

defined in 44 U.S.C. 3502(5), voluntarily 

complies with the Executive order to 

adhere to fundamental federalism 

principles. 

This proposed rule would 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. The NCUA has 

therefore determined that this proposed 

rule does not constitute a policy that has 

federalism implications for purposes of 

the Executive order. 

D. Assessment of Federal Regulations 

and Policies on Families 

The NCUA has determined that this 

proposed rule will not affect family 

well-being within the meaning of 

section 654 of the Treasury and General 

Government Appropriations Act, 1999, 

Public Law 105–277, 112 Stat. 2681 

(1998). 

List of Subjects in 12 CFR Part 702 

Credit, Credit unions, Reporting and 

recordkeeping requirements. 

By the NCUA Board on January 14, 2021. 

Melane Conyers-Ausbrooks, 

Secretary of the Board. 

For the reasons discussed in the 

preamble, the Board proposes to amend 

part 702 of chapter VII of title 12 of the 

Code of Federal Regulations as follows: 

PART 702—CAPITAL ADEQUACY 

■ 1. The authority citation for part 702 

continues to read as follows: 

Authority: 12 U.S.C. 1766(a), 1790d. 

§ 702.103 [Amended] 

■ 2. Amend § 702.103(a) by removing 

the words ‘‘fifty million dollars 

($50,000,000)’’ and add in their place 

‘‘five hundred million dollars 

($500,000,000).’’ 

[FR Doc. 2021–01400 Filed 2–22–21; 8:45 am] 

BILLING CODE 7535–01–P 

DEPARTMENT OF TRANSPORTATION 

Federal Aviation Administration 

14 CFR Part 39 

[Docket No. FAA–2020–0994; Project 

Identifier AD–2020–00687–T] 

RIN 2120–AA64 

Airworthiness Directives; Gulfstream 

Aerospace Corporation Airplanes 

AGENCY: Federal Aviation 

Administration (FAA), DOT. 

ACTION: Notice of proposed rulemaking 

(NPRM). 

SUMMARY: The FAA proposes to adopt a 

new airworthiness directive (AD) for 

certain Gulfstream Aerospace 

Corporation (Gulfstream) Model GVII– 

G600 airplanes. This proposed AD was 

prompted by a report that a failure mode