Credit Unions Freed from Stuffing Surety Cash in Segregated Boxes
Published Date: 8/6/2026
Rule
Summary
The NCUA Board (Board) is amending its regulations to eliminate prescriptive segregated deposit and collateral requirements for suretyship and guaranty agreements. By removing these requirements, the Board is authorizing federally insured credit unions (FICUs) acting as sureties and guarantors to design products that address member needs while maintaining safety and soundness standards. Federal credit unions (FCUs), and federally insured, state-chartered credit unions (FISCUs) if permitted under state law to act as a surety or guarantor, continue to be subject to other requirements related to these arrangements, including the applicable lending regulations. The final rule follows publication of the December 29, 2025, proposed rule, and takes into consideration the public comments received.
Analyzed Economic Effects
3 provisions identified: 3 benefits, 0 costs, 0 mixed.
NCUA removes prescriptive collateral rules
Starting September 8, 2026, the NCUA removed the specific requirement that federally insured credit unions keep segregated deposits or follow detailed collateral formulas when they act as a surety or guarantor under 12 CFR 701.20. This change lets federally insured credit unions design these products with more flexibility and reduces the specific collateral paperwork and formulas they previously had to follow.
Safety limits stay in place
Even after the change, any surety or guaranty must still limit the credit union's obligation to a fixed dollar amount and a specified duration, and the credit union's performance must create a loan that follows the applicable lending rules. These remaining rules keep safety and soundness protections in place while the prescriptive collateral formulas are removed.
Small credit unions may see lower costs
NCUA says removing the segregated deposit and collateral rules may reduce compliance burdens, simplify arrangements, and lower supervision or examination costs for small federal and state credit unions that are permitted to act as sureties or guarantors. The agency also certified the rule will not have a significant economic impact on a substantial number of small credit unions.
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The NCUA Board (Board) is amending its regulations that establish the requirements for obtaining and maintaining federal share insurance with the National Credit Union Share Insurance Fund (Share Insurance Fund). The provisions of this part apply to all federally insured credit unions (FICUs). This final rule will reduce regulatory burden by amending the provision on the timing of prior notice provided to members of the termination of excess non-federal insurance coverage.
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The NCUA Board (Board) is rescinding Interpretive Ruling and Policy Statement (IRPS) 06-1. The Chartering and Field of Membership Manual (Chartering Manual) incorporates the current requirements for adding underserved areas, making IRPS 06-1 unnecessary. This rescission reduces the burden for federal credit unions (FCUs) by limiting the number of sources that FCUs must check to verify compliance with applicable requirements. After considering the public comments, the Board adopts the proposal without modification.