WSR 09-09-076

PREPROPOSAL STATEMENT OF INQUIRY

DEPARTMENT OF

FINANCIAL INSTITUTIONS
(Division of Credit Unions)

[ Filed April 14, 2009, 5:31 p.m. ]

Subject of Possible Rule Making: Requirements and standards for state-chartered credit unions in the mitigation of losses for loans collateralized by real property, or real property acquired as [a] result of loan defaults, and the management, marketing, sales and accounting practices required when dealing with other real estate owned (OREO), typically from foreclosed properties.

Statutes Authorizing the Agency to Adopt Rules on this Subject: RCW 31.12.404, 31.12.426, 31.12.428, 31.12.436, 31.12.516, 31.12.569.

Reasons Why Rules on this Subject may be Needed and What They Might Accomplish: Needed to maintain safe and sound practices of credit union operations by providing standards and guidelines for evaluating, managing and selling OREO. OREO is real property that a state-chartered credit union holds as a consequence of defaults on loans.

Other Federal and State Agencies that Regulate this Subject and the Process Coordinating the Rule with These Agencies: The National Credit Union Administration (federal agency). Coordination will occur by communication with the NCUA and by monitoring relevant federal exam guidelines and rule making on the subject of this rule.

Process for Developing New Rule: Negotiated rule making.

Interested parties can participate in the decision to adopt the new rule and formulation of the proposed rule before publication by attending any public hearings on the proposed rule, and by contacting the Division of Credit Unions, Joanne Conrad, Regulatory Analyst, P.O. Box 41200, Olympia, WA 98504-1200, phone (360) 902-8813, fax (360) 704-6490, e-mail jconrad@dfi.wa.gov.

April 14, 2009

Linda Jekel

Director

Washington State Code Reviser's Office