ALEXANDRIA, Va. – Federal credit unions may borrow funds to acquire investments, as long as the investments satisfy preexisting rules and regulations, NCUA said yesterday in a new legal opinion.
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Under the Federal CU Act, credit unions have the express power to borrow from any source, limited to 50% of paid-in and unimpaired capital and surplus, said NCUA, in a legal opinion issued to Utilities Employees CU. The credit union is seeking a parity ruling from the Pennsylvania Department of Banking.
The statute and the regulation do not restrict how an FCU can use borrowed funds, said NCUA.
