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Chairman Hood: COVID-19 Relief Extension Will Support Credit Unions, Assist Members

December 2020
Chairman Hood: COVID-19 Relief Extension Will Support Credit Unions, Assist Members

ALEXANDRIA, Va. (Dec. 28, 2020) – The extension of several COVID-19 relief measures in the Consolidated Appropriations Act, 2021 will ensure that credit unions can support their member-owners during the next phase of the pandemic, National Credit Union Administration Chairman Rodney E. Hood said today.

“These vital extensions ensure the NCUA and federally insured credit unions are able to respond to the evolving nature of COVID-19, and they provide needed regulatory certainty to the industry,” Chairman Hood said. “I wish to thank Chairwoman Waters and Ranking Member McHenry, and Chairman Crapo and Ranking Member Brown for their leadership and support for these vital measures. I also thank my fellow Board members for their efforts in support of these critical provisions.”

The Consolidated Appropriations Act, 2021, which was signed into law by President Donald J. Trump on Dec. 27, extends several provisions of the Coronavirus Aid, Relief, and Economic Security (CARES) Act and the Paycheck Protection Program and Health Care Enhancement Act. These provisions include:

Measures that Ensure Continued Stability and Regulatory Relief

The act extends the CARES Act provisions that provided the Central Liquidity Facility with increased flexibility and borrowing authority to support the liquidity needs of the system and the Share Insurance Fund through Dec. 31, 2021.

Additionally, the act extends the regulatory relief measures related to troubled debt restructurings and it lengthens the exemption from complying with the Financial Accounting Standards Board’s current expected credit losses methodology until Jan. 1, 2022.

Measures that Support Community-Based Financial Institutions

The act provides $12 billion in COVID-19 relief funding for community development financial institutions that predominantly serve minority communities. Approximately a third of this $12 billion is set aside for smaller financial institutions with less than $2 billion in assets.

Additionally, the act provides the Community Development Financial Institutions Fund with $270 million in supplemental funding. The Community Development Revolving Loan Fund, which the NCUA administers, also received $1.5 million in funding for technical assistance grants and low-interest loans to support low-income credit unions.

Measures that Aid Credit Union Members and Businesses

The act also provides additional support for and extends the Paycheck Protection Program (PPP) through March 31, 2021. Approximately $284 billion is set aside for first and second round forgivable PPP loans. There is also a dedicated $15 billion set-aside for PPP lending through community-based financial institutions like CDFIs and minority depository institutions, along with other changes to the PPP program.

Additional information on the Consolidated Appropriations Act, 2021 is available online.

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