702.107—Alternative components for standard calculation.

A credit union may substitute one or more alternative components below, in place of the corresponding standard components in § 702.106 above, when any alternative component amount, expressed as a percentage of the credit union's quarter-end total assets as reflected in its most recent Call Report, rounded to two decimal places, is smaller (Table 5):
(a) Long-term real estate loans. The sum of:
(1) Non-callable. Non-callable long-term real estate loans as follows:
(i) Eight percent (8%) of the amount of such loans with a remaining maturity of greater than 5 years, but less than or equal to 12 years;
(ii) Twelve percent (12%) of the amount of such loans with a remaining maturity of greater than 12 years, but less than or equal to 20 years; and
(iii) Fourteen percent (14%) of the amount of such loans with a remaining maturity greater than 20 years;
(2) Callable. Long-term real estate loans callable in 5 years or less as follows:
(i) Six percent (6%) of the amount of such loans with a documented call provision of 5 years or less and with a remaining maturity of greater than 5 years, but less than or equal to 12 years;
(ii) Ten percent (10%) of the amount of such loans with a documented call provision of 5 years or less and with a remaining maturity of greater than 12 years, but less than or equal to 20 years; and
(iii) Twelve percent (12%) of the amount of such loans with a documented call provision of 5 years or less and with a remaining maturity of greater than 20 years;
(b) Member business loans outstanding. The sum of:
(1) Fixed rate. Fixed-rate member business loans outstanding as follows:
(i) Six percent (6%) of the amount of such loans with a remaining maturity of 3 or fewer years;
(ii) Nine percent (9%) of the amount of such loans with a remaining maturity greater than 3 years, but less than or equal to 5 years;
(iii) Twelve percent (12%) of the amount of such loans with a remaining maturity greater than 5 years, but less than or equal to 7 years;
(iv) Fourteen percent (14%) of the amount of such loans with a remaining maturity greater than 7 years, but less than or equal to 12 years; and
(v) Sixteen percent (16%) of the amount of such loans with a remaining maturity greater than 12 years; and
(2) Variable-rate. Variable-rate member business loans outstanding as follows:
(i) Six percent (6%) of the amount of such loans with a remaining maturity of 3 or fewer years;
(ii) Eight percent (8%) of the amount of such loans with a remaining maturity greater than 3 years, but less than or equal to 5 years;
(iii) Ten percent (10%) of the amount of such loans with a remaining maturity greater than 5 years, but less than or equal to 7 years;
(iv) Twelve percent (12%) of the amount of such loans with a remaining maturity greater than 7 years, but less than or equal to 12 years; and
(v) Fourteen percent (14%) of the amount of such loans with a remaining maturity greater than 12 years.
(c) Investments. The sum of:
(1) Three percent (3%) of the amount of investments with a weighted-average life (as specified in § 702.105 above) of one (1) year or less;
(2) Six percent (6%) of the amount of investments with a weighted-average life greater than one (1) year, but less than or equal to three (3) years;
(3) Eight percent (8%) of the amount of investments with a weighted-average life greater than three (3) years, but less than or equal to five (5) years;
(4) Twelve percent (12%) of the amount of investments with a weighted-average life greater than five (5) years, but less than or equal to seven (7) years;
(5) Sixteen percent (16%) of the amount of investments with a weighted-average life greater than seven (7) years, but less than or equal to ten (10) years; and
(6) Twenty percent (20%) of the amount of investments with a weighted-average life greater than ten (10) years.
(d) Loans sold with recourse. The alternative component is the sum of:
(1) Six percent (6%) of the amount of loans sold with contractual recourse obligations of six percent (6%) or greater; and
(2) The weighted average recourse percent of the amount of loans sold with contractual recourse obligations of less than six percent (6%), as computed by the credit union.
Table 5—§ 702.107 Alternative Components for Standard Calculation

Code of Federal Regulations

[Please see PDF for image: ER29NO02.066 ]

Code of Federal Regulations

[Please see PDF for image: ER06JA03.005 ]

Code of Federal Regulations

[Please see PDF for image: ER06JA03.006 ]

Code of Federal Regulations

Code of Federal Regulations 524
[Please see PDF for image: ER29NO02.074 ]

Code of Federal Regulations

[65 FR 44966, July 20, 2000, as amended at 67 FR 71088, Nov. 29, 2002]