The National Credit Union Administration on Thursday proposed rules designed to increase regulatory sanctions as a credit union's capital decreases.

The proposal, which mirrors the banking agencies' "prompt corrective action" rules, mandates how regulators must respond when a federally insured credit union becomes undercapitalized. The agency's three-member board set a 90-day comment period for the proposal. The proposed rule was the third of six that the NCUA must issue to enforce the credit union law enacted in August.

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