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Leagues’ Analysis on NCUA’s Call Report Fee Income Changes

As previously reported, the National Credit Union Administration (NCUA) has implemented changes to the 5300 Call Report. These changes require credit unions with assets totaling $1 billion or more to report their fee income derived from overdraft and non-sufficient funds (NSF) fees.

However, credit unions with less than $1 billion in assets are exempt from submitting data on overdraft and NSF fees (see further details below). The new reporting requirements affect the first quarter 2024 Call Report, due during the week of April 30.

Specifically, the updated Call Report introduces additional fields within the Non-Interest Income section. These fields, labeled “Overdraft Fee Income — Account IS0048” and “NSF Fee Income — Account IS0049,” are to be completed solely by credit unions exceeding the $1 billion asset threshold.

The NCUA has made the Call Report form and instructions available for review, including details on how these changes are reflected in item 13. For credit unions below the $1 billion asset threshold, the California and Nevada Credit Union Leagues contacted the NCUA to determine whether these institutions are automatically restricted from accessing the new fields. The NCUA has confirmed that credit unions with assets under $1 billion will be unable to input data into these two fields. If a credit union below $1 billion initially attempts to enter data, the system will generate an “Error” notification and prompt the user to remove the information before submission.

Furthermore, concerning NSF fee reporting, the instructions specify that NSF fees are those recorded as income under Generally Accepted Accounting Principles (GAAP) in the current period. These fees are charged to a share or deposit account holder for a declined transaction that would have exceeded the account balance if the credit union had honored the payment. Credit unions are advised to consult with their accounting and finance professionals to determine which fees qualify as income under GAAP and whether any deductions are applicable.

For more details on these Call Report changes, please refer to a recent America’s Credit Unions compliance blog post.

Given the substantial number of credit unions in California and Nevada surpassing the $1 billion asset threshold, the Leagues have concerns regarding data reporting implications. The Leagues have initiated discussions with NCUA officials, including Vice Chairman Kyle Hauptman and Board Member Tanya Otsuka, urging the NCUA to reconsider its approach and offer guidance instead. The Leagues will continue to work with the NCUA and other regulatory policymakers and congressional legislators on the perception of overdraft and NSF fees, giving credit unions a voice in the state and national discussion.

The Leagues will stay vigilant on this matter and keep credit union leaders updated as it evolves.

As a reminder, the Leagues have also launched a Credit Union Overdraft Resources site for members to access, which includes talking points, facts, research, a downloadable opinion-editorial template, and a regulatory timeline. Please take advantage of these resources to support your credit union’s media relations efforts and internal conversations with staff. If you have any questions, email Leagues Vice President of Regulatory Advocacy and Compliance Lisa Quaranta.

Access the ‘Compliance Hotline’
Your League-member benefits include the Compliance Hotline — providing exclusive access to dedicated compliance experts:

Using the above phone number and email address, you can gain access to a knowledgeable team that’s ready to address all your credit union’s compliance inquiries — promptly and efficiently. With the Compliance Hotline, you can proactively respond to impromptu questions and issues by getting clarity and insight on technical topics that normally slow you down. We want to help you unlock the full potential of your League membership by leveraging the resources and support you need to navigate the complex world of compliance effortlessly. We’re ALWAYS just a phone call or email away!

Additionally, other League-member compliance resources include:

  • ViClarity
  • CU PolicyPro
  • ComplySight
  • InfoSight
  • CU Store
  • Record Retention Guide
  • GRC Technology Solutions 

For more information, email Lisa Quaranta.

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