37034 Federal Register / Vol. 76, No. 122 / Friday, June 24, 2011 / Proposed Rules 

provider. An FCU must operate 

according to the third party pilot 

program standards when it is approved 

to engage in derivatives activities 

through an approved third party. NCUA 

therefore seeks comment on the 

approval standards for an FCU seeking 

to engage in derivatives activity through 

a third party. 

Question No. 

1. Should NCUA require an FCU to 

state a balance sheet management plan 

to hedge IRR based on risk management 

objectives as a condition for approval? 

Explain why or why not. 

2. Is it useful for an FCU to rely on 

the expertise of a third party to assess 

the effectiveness of derivatives to hedge 

IRR on an ongoing and dynamic basis or 

should the FCU be required to 

demonstrate it has this expertise 

internally as a condition for approval? 

In either case explain why or why not. 

3. Is it useful for an FCU to rely on 

the expertise of a third party to assess 

the credit quality of derivative 

counterparties? Explain why or why 

not. 

E. Approval To Engage Independently 

NCUA expects that approving an FCU 

to independently engage in derivatives 

activity would require extensive 

examination of the applicant FCU and 

also would require enhanced 

supervision. This approval would be 

similar to the granting of expanded 

authority for a corporate credit union 

under recently revised Part 704, 75 FR 

64786 (Oct. 20, 2010) and would require 

a self-assessment by the FCU to support 

its request. The NCUA Board would 

expect an FCU to address the following 

items prior to granting approval for that 

FCU to engage in derivatives activities 

independently: 

i. Board of directors’ policy 

identifying the specific purposes of 

specified derivatives activities and 

stating limits on maximum exposure in 

terms of notional principal amounts and 

mark-to-market values of individual and 

aggregate swaps; 

ii. Ongoing assessment and reporting 

to the FCU’s board of directors of 

derivative performance in achieving 

explicit interest rate risk management 

objectives; 

iii. Selection criteria for eligible 

counterparties that address the process 

of identification and credit monitoring; 

posting of bilateral collateral and 

process for maintenance of available 

collateral; 

iv. Disclosure of derivative price at 

time of purchase expressed as dollar 

values of a basis point on each 

derivative instrument; 

v. Disclosure of costs of terminating 

any derivatives in the course of 

pursuing any exit strategy. 

NCUA would expect the FCU’s board 

of directors to review policy 

periodically, to review the FCU’s 

derivatives positions on an ongoing 

basis, and to actively enforce 

compliance with the stated IRR 

management purpose of derivative 

activities. 

Question No. 

1. Should approval of an FCU to 

engage in derivatives activities be in the 

form of additional authorization similar 

to the expanded authority available 

under Appendix B to Part 704— 

Expanded Authorities and 

Requirements? Explain why or why not. 

2. Should an FCU demonstrate 

enhanced credit functionality in terms 

of the experience of the FCU’s 

personnel, credit analysis and reporting 

infrastructure in order to evaluate the 

creditworthiness of derivative 

counterparties? Explain why or why not 

and describe any minimum expectation. 

3. Should an FCU demonstrate 

enhanced hedging expertise based on 

the experience of FCU’s personnel or on 

additional derivatives management 

infrastructure? Explain why or why not, 

and describe any minimum expectation. 

4. Is one year a sufficient amount of 

time for an FCU to fully prepare a selfassessment and application for approval 

to independently engage in derivatives 

to offset IRR? Explain why it is 

sufficient or why more time may be 

required. 

5. Are there any additional aspects of 

the FCU besides items (i)–(v) above 

which NCUA should consider in its 

approval for the FCU to engage in 

derivatives activity independently? If 

so, explain why the item should be 

considered. 

By the National Credit Union 

Administration Board on June 17, 2011. 

Mary F. Rupp, 

Secretary of the Board. 

[FR Doc. 2011–15738 Filed 6–23–11; 8:45 am] 

BILLING CODE P 

DEPARTMENT OF TRANSPORTATION 

Federal Aviation Administration 

14 CFR Part 71 

Proposed Modification of the Las 

Vegas, NV, Class B Airspace Area; 

Public Meetings; Correction 

AGENCY: Federal Aviation 

Administration (FAA), DOT. 

ACTION: Notice of meetings; correction. 

SUMMARY: The FAA published a Notice 

of Meetings in the Federal Register of 

June 17, 2011, concerning a proposal to 

modify Class B airspace at Las Vegas, 

NV. The document contained an 

incorrect address for the informal 

airspace meeting scheduled Tuesday, 

August 23, 2011, in Henderson, NV. 

Also, the document contained the 

wrong phone number for the contact 

person. The information for the other 

two meetings is correct as originally 

published. 

FOR FURTHER INFORMATION CONTACT: John 

Gough, Manager, Airspace and 

Procedures, and Bill Ruggiero, Support 

Manager Las Vegas, TRACON, 699 

Wright Brothers Lane, Las Vegas, NV 

89119; telephone: (702)–262–5910. 

Correction 

In the Federal Register of June 17, 

2011, in FR Doc. 2011–15107, on page 

35371, column 3, correct meeting 

number (2) in the ADDRESSES caption to 

read: 

ADDRESSES: (2) The meeting on 

Tuesday, August 23, 2011, will be held 

at Coronado High School, 1001 

Coronado Center Drive, Henderson, NV, 

89052. 

On page 35371, column 3, correct FOR

FURTHER INFORMATION CONTACT caption 

to read: 

FOR FURTHER INFORMATION CONTACT: John 

Gough, Manager, Airspace and 

Procedures, and Bill Ruggiero, Support 

Manager Las Vegas, TRACON, 699 

Wright Brothers Lane, Las Vegas, NV 

89119; telephone: (702) 262–5910. 

Issued in Washington, DC, on June 20, 

2011. 

Gary A. Norek, 

Acting Manager, Airspace, Regulations and 

ATC Procedures Group. 

[FR Doc. 2011–15884 Filed 6–23–11; 8:45 am] 

BILLING CODE 4910–13–P 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Part 1 

[REG–137125–08] 

RIN 1545–BI65 

Certain Employee Remuneration in 

Excess of $1,000,000 Under Internal 

Revenue Code Section 162(m) 

AGENCY: Internal Revenue Service (IRS), 

Treasury. 

ACTION: Notice of proposed rulemaking. 

SUMMARY: This document contains 

proposed regulations relating to the 


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