ALEXANDRIA, Va. — The NCUA Board looked to expand federal credit union investment powers and cut the budget while setting the record straight on catastrophic act reporting and records preservation at last week's board meeting.

The agency issued an Advance Notice of Proposed Rulemaking seeking comment on a wide variety of safety and soundness concerns associated with allowing natural person federal credit unions and corporates to make investments denominated in foreign currency. The agency has asked for the industry's perspective on a number of concerns related to the proposed power, including whether the investments should be restricted to domestic issuers, exchange rate risk, credit risk, information and technology risk, and the need for internal controls and exit strategies. The ANPR was issued with a 90-day comment period.

This type of investing is not explicitly prohibited in the Federal Credit Union Act but NCUA's regulations currently do not allow for it. NCUA recently amended it share insurance rule to authorize federally insured credit unions to accept member shares denominated in foreign currency, which was part of the impetus for this proposal. The proposal also states that NCUA is not considering lending in foreign currencies at this time but may do so in the future.