What Credit Unions Should Know About Subordinated Debt
Subordinated debt is an unsecured loan issued by a depository institution that is treated as regulatory capital due to its subordination to all other creditors. Recent changes to the NCUA’s subordinated debt regulations, issued late 2021 and effective January 1 of this year, have expanded and modernized the rule.
Low-income designated credit unions (LICUs)
[1] were given the ability to issue subordinated debt in 1996 with the finalization of CFR 701.34, allowing LICUs to raise secondary capital from foundations and phil...
Want to keep reading? This content is for subscribers only.
Login
Subscribe
