NCUA Issues New Opinion Regarding Loan Participation Regulation

On March 22, 2018, the National Credit Union Administration’s Office of the General Counsel issued a new opinion on the loan participation regulation – 12 CFR 701.22

The Opinion makes clear that “provisions of the loan participation regulation must be met throughout the life of the transaction” and that “each participated loan must be identified and treated independently”. The Opinion concludes that these requirements support the principle that each purchase or sale of a loan participation represents an interest in a single loan, which must be maintained throughout the life of the participated loan.

In this white paper, LoanStreet provides practical guidance on how credit unions can implement the Opinion to ensure compliance with the loan participation regulation.