Connecticut State Capitol building in Hartford. Photo by Michael Marciano/ALM
Gov. Ned Lamont has signed into law Public Act 25-37, a sweeping update to Connecticut’s credit union statutes that modernizes rules surrounding nonmember payments, member business loans, charitable contributions and insider credit policies.
The new law, originally introduced as Substitute House Bill 7083, takes effect July 1 and was designed to bring clarity and flexibility to credit union operations across the state.
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One of the most notable changes expands the ability of community development financial institution-designated credit unions to accept nonmember payments. Under the law, nonmember deposits are allowed within tiered limits based on asset size, ranging from $6.25 million for institutions under $250 million in assets to $25 million for those with over $1 billion.
Public Act 25-37 also updates the definition of “member business loans,” making it easier for credit unions to lend to businesses, including nonmembers, under certain conditions. It clarifies that commercial loans acquired in compliance with federal regulations will not count against member business loan caps, provided they aren’t used to circumvent those limits.
The law modifies charitable giving authority as well. Credit union senior management can now make charitable donations up to one ten-thousandth of the institution’s net assets without board approval. Larger contributions or those involving potential conflicts of interest require a majority board vote and documentation.
Governance and insider lending rules were also tightened. The act requires boards to adopt written conflict-of-interest policies and restricts favorable loan terms to insiders unless consistent with a documented and uniformly applied board policy.
Lastly, the law revised the definition of “net worth” for Connecticut credit unions, aligning it more closely with NCUA guidelines by including secondary capital for low-income designated institutions.
State regulators said the updates will improve safety, soundness and regulatory alignment for the more than 70 state-chartered credit unions operating in Connecticut.
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Michael Ogden
Editor-in-Chief at CU Times. To connect, email at [email protected]. As Editor-in-Chief of CU Times since 2016, Michael Ogden has led the editorial team in all aspects of content strategy and execution, including the creation of the publication’s exclusive and proprietary research database of the credit union industry’s economic landscape. Under Michael’s leadership, CU Times has successfully shifted to an all-digital editorial product with new focuses on the payments, fraud, lending and regulatory beats. Most recently, he introduced a data-focused editorial product for subscribers that breaks down credit union issues into hard data, allowing for a deeper and more factual narrative for readers. In 2024, he launched the "Shared Accounts With CU Times" podcast, which offers a fresh, inside-the-newsroom perspective through interviews with leaders from the credit union industry and the regulatory world. He dives into pressing credit union issues, while revealing the personalities working behind-the-scenes to push the credit union world forward. His background includes years as a radio and TV anchor/reporter and a public relations and digital/social media manager, where he covered the food and music industries, as well as cooperatives and credit unions. Over the years, he has launched numerous exclusive video and podcast series, including a successful series of interactive backstage interviews with musicians at music festivals, showcasing his social media and live streaming production skills.
