Employees May Be Given Favorable Loans
A credit union may grant loans to its employees at more favorable terms than those provided to its members, according to a new legal opinion letter issued by state regulators here. The legal opinion, issued by the Department of Financial Institutions, notes that neither the state's credit union code nor NCUA's rules forbids credit unions from offering loan discounts to their employees.
The lone exception is if those employees are also serving as directors or members of the credit or supervisory committees, the state regulator said. The state law specifically prohibits CUs from offering loans to directors or supervisory and credit committee members under more favorable terms and conditions than loans offered to members, generally.