12 CFR 725.18 - Creditworthiness.

§ 725.18 Creditworthiness.

(a) Prior to Facility approval of each application of a Regular member for a Facility advance, the Facility shall consider the creditworthiness of such member.

(b) Prior to an Agent's approval of each application of a member natural person credit union for an extension of credit on which an application by the Agent to the Facility will be based, an Agent shall consider the creditworthiness of such member natural person credit union.

(c) Specific characteristics of an uncreditworthy credit union include, but are not limited to, insolvency as defined in paragraph (1) to the definition of “insolvency in § 700.2 of this chapter, unsatisfactory practices in extending credit, lower than desirable reserve levels, high expense ratio, failure to repay previous Facility advances as agreed, excessive dependence on borrowed funds, inadequate cash management policies and planning, or any other relevant characteristics creating a less than satisfactory condition. The presence of one or more of these characteristics will not necessarily mean that a credit union will be considered uncreditworthy.

(d) A natural person credit union (whether a Regular member of the Facility or a member natural person credit union) which does not meet the Facility's creditworthiness standards may be limited in or denied the use of advances for its liquidity needs.

[ 44 FR 49437, Aug. 23, 1979, as amended at 69 FR 27829, May 17, 2004; 76 FR 60367, Sept. 29, 2011]

This is a list of United States Code sections, Statutes at Large, Public Laws, and Presidential Documents, which provide rulemaking authority for this CFR Part.

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United States Code

Title 12 published on 17-Nov-2018 03:48

The following are ALL rules, proposed rules, and notices (chronologically) published in the Federal Register relating to 12 CFR Part 725 after this date.

  • 2013-05-31; vol. 78 # 105 - Friday, May 31, 2013
    1. 78 FR 32541 - Technical Amendments
      GPO FDSys XML | Text
      Final rule.
      The final rule is effective on May 31, 2013.
      12 CFR Parts 700, 701, 702, 704, 707, 708a, 708b, 709, 712, 716, 723, 725, 741, 745, 748, 750, 761, 790, 791, and 792