amendments to the charter requested as provided in the bylaws. No amendment of the bylaws or of the charter shall become effective, however, until approved in writing by the Director.

§ 701.5 Other applications.

(a) Except as otherwise provided by rule or regulation of the Bureau all applications, requests, and submittals regarding Federal credit unions, for which no form of application has been prescribed by the Bureau, shall be in writing, signed by the applicant or his duly authorized agent, and shall contain a statement of the action requested, the reasons and facts relied upon as the basis for such requested action, and the applicant's interest in the matter. The application, request, or submittal shall be addressed to the Regional Representative or to the Bureau of Federal Credit Unions in Washington, D.C. The applicant shall furnish such other pertinent information as may be required by the Director.

(b) Unless otherwise provided in these regulations, all applications regarding Federal credit union matters shall be in

(a) Extent of fee. (1) Not later than January 31 of each calendar year, each Federal credit union shall pay to the Bureau, for the preceding calendar year, a supervision fee in accordance with the graduated scale set forth in subparagraph (2) of this paragraph on the basis of assets as of December 31 of such preceding year, but such fee shall in no event be less than $10.00: Provided, however, That no such annual fee shall be payable by such an organization with respect to the year in which its charter is issued or the year in which final distribution is made in liquidation of the credit union or the charter is otherwise canceled.

(2) Scale of supervision fees:

Total assets

$500,000 or less..

Maximum fee

excess of

Over $5,000,000——

Provided, however, That no fee shall be payable with respect to the last fractional part of $1,000 of total assets.

(3) Definition of assets:

(1) The term, "assets," as used in this section shall mean all items properly coming within the classification of asset accounts as stated in the Accounting Manual for Federal Credit Unions, FCU544, as revised.

(li) The term, "total assets," as used in this section shall mean the sum of all assets.

(b) Supervision fee certificate. The treasurer of each Federal credit union shall certify as to the correctness of the Supervision Fee Certificate, Form FCU511 Rev. He shall send, not later than January 31 of each year, the original

Supervision Fee Certificate and as many copies as the Bureau may request, together with a check in payment of the supervision fee stated on the Supervision Fee Certificate to be due, to the Bureau of Federal Credit Unions in Washington, D.C. Copies of the Supervision Fee Certificate form may be obtained from any Regional Office.

(c) Checks in payment of supervision fees. All checks in payment of supervision fees shall be made payable to the Bureau of Federal Credit Unions.

(d) Audit of supervision fee computation and payment. Whenever the Bureau makes a regular or special examination of a Federal credit union, the employee of the Bureau making the examination will audit the computation

and payment of annual supervision fee(s) for the years which have elapsed since the last previous audit. Such employee shall adjust any errors in computation and the Federal credit union shall deliver to such employee a check payable to the Bureau of Federal Credit Unions to cover the amount of any underpayment of the supervision fee(s). The decision of the employee of the Bureau as to the amount due shall be final and conclusive: Provided, That the Federal credit union may make the supplementary payment subject to the results of an appeal from the employee's decision to the Regional Representative: Provided further, That the Federal credit union shall file such appeal within 30 days from the date of the employee's decision. If the audit discloses that an overpayment has been made, the employee of the Bureau is authorized to advise and assist the Federal credit union to prepare and file a request for a refund of the amount of overpayment. Such request should be addressed to the Regional Representative.

§ 701.7

Fee for examination.

(a) Each Federal credit union shall pay the Bureau a fee for each examination in accordance with the schedule of fees fixed from time to time by the Director.

(b) In establishing such fees, the Director shall consider the anticipated aggregate cost of the examination program including supervision, salaries, travel and all other items which affect the cost of the examination program.

(c) The fee for examinations of Federal credit unions with assets of less than $25,000 shall not exceed 50 cents per hundred dollars of assets as of the effective date of the examination. The Director may establish a minimum fee for examination which shall not exceed $25.00. The Director may waive the fee for an examination within twelve months after the date a charter is approved if the payment would, in the opinion of the Director, cause a hardship.

(d) Each Federal credit union shall be notified at least 30 days prior to the effective date of any schedule of fees fixed pursuant to this section. Upon receipt of such notification interested persons may submit written data, views, or arguments for consideration by the Director, and the Director may, after con

sideration, make such revisions in the proposed schedule or such change in the effective date as he deems appropriate. Each Federal credit union shall be notified of such revision or change not less than 15 days prior to the final effective date.

§ 701.8 Fee for examination of Federal credit unions in liquidation. Federal credit unions in liquidation may be examined prior to or following completion of liquidation. A fee assessed in accordance with the most recent schedule of examination fees prescribed by the Director as provided in § 701.7 shall be paid for each such examination. § 701.9 Loans by Federal credit unions to other credit unions.

(a) Upon authorization of its board of directors, or a duly authorized and appointed executive committee, a Federal credit union may invest its funds in loans to other credit unions in the total amount not exceeding 25 percent of its paid-in and unimpaired capital and surplus. The terms of the loans shall not exceed 1 year.

(b) Prior to making such loans, the Federal credit union shall require the borrowing credit union to furnish the following:

(1) A current financial and statistical report;

(2) A certified copy of the resolution of the board of directors or the executive committee authorizing such borrowing; and

(3) A certificate from the secretary of the credit union that the persons negotiating the loan and executing the note are officers of the credit union and are authorized to act in its behalf, and that such borrowing does not exceed the maximum borrowing power of the borrowing credit union.

[34 F.R. 1398, Jan. 29, 1969]

§ 701.10 Establishment of a cash fund.

The board of directors of a Federal credit union may authorize the establishment of or changes in a cash fund for making change, cashing checks, or other purposes. Before such authorization is given, the directors will consider whether a need for the fund exists and will insure that adequate safeguards and accountability will exist to protect the fund. [34 F.R. 1398, Jan. 29, 1969]

Each operating Federal credit union shall file annually with the Regional Representative, within 10 days after the election or appointment of officials, a report setting forth the names and addresses of its officials. Copies of the standard form of report prescribed by the Bureau (Form FCU-2) may be obtained from the Regional Representative or from the Bureau in Washington, D.C. § 701.12 Supervisory committee audits.

(a) The supervisory committee of each Federal credit union shall make or cause to be made, as a minimum, two audits each calendar year. These audits shall be made as of the dates and in accordance with the standards outlined in the "Supervisory Committee Manual for Federal Credit Unions" (FCU-545). One audit shall be a comprehensive annual audit, covering the period elapsed since the last comprehensive annual audit. A report of this audit on Form FCU-701 shall be promptly made to the board of directors of the Federal credit union, and, upon request, to the Regional Representative. A summary of the report shall be submitted to the members at the next annual meeting. A report of the second audit shall be promptly made to the board of directors on Form FCU-702, and, upon request, to the Regional Representative. A summary of the report of the second audit also shall be submitted to the members at the next annual meeting.

(b) The supervisory committee is responsible for the preparation and maintenance of work papers used in the audits. These work papers shall be made available by the committee for review by the Federal Credit Union Examiner during his supervisory examination.

(c) The supervisory committee shall conduct supplementary audits upon request of the Director. The committee also may conduct additional audits on its own initiative.

[34 F.R. 1398, Jan. 29, 1969]

(b) When it is deemed necessary or desirable and upon written notice from the Director, Federal credit unions shall file, in accordance with instructions contained in such notice as to time and place, such Financial and Statistical or other reports as of such date or dates as shall be prescribed in such notice.

(c) When it is deemed necessary because of the condition of the Federal credit union and upon written notice from the Director or Regional Representative, the Federal credit union shall file, in accordance with the instructions contained in such notice as to time and place, Financial and Statistical reports including reports on Form FCU-109, as of such date or dates as shall be prescribed in such notice.

§ 701.14 Instructions for officials.

The Bureau has published a number of manuals and booklets for use by officials of Federal credit unions in carrying out their duties. Officials should be familiar with the contents of the manuals dealing with their areas of responsibility. Even when not described as mandatory, the guidelines and instructions contained in these publications should be given serious consideration, since they grew out of many years of experience in the supervision of Federal credit unions.

(a) Handbook for Federal credit unions. This manual, designated FCU543, contains instructions for directors and officers of Federal credit unions. A copy is mailed to each Federal credit union at the time the approved organization certificate is delivered to the incorporators by the Bureau. Additional copies are for sale at the Government Printing Office. Revisions in the Handbook are made from time to time and are mailed to all Federal credit unions. Announcements of revisions are carried in the BFCU Bulletin for the benefit of the general public. The Handbook contains a "ready reference," which indexes the Handbook, the Federal Credit Union Act, standard bylaws, the rules and regulations, and the accounting, supervisory committee and credit manuals. The reference is updated as necessary.

(b) Accounting manual for Federal credit unions. This manual, designated FCU-544, contains information on standard accounting procedures, types of records, and standard accounting forms for Federal credit unions. Provision is made for the development of substitutes for any of the forms and for their use

without advance approval by the Bureau. The substitute forms, however, must meet criteria set forth in the manual. A copy of the manual is mailed to each Federal credit union at the time the approved organization certificate is delivered to the incorporators by the Bureau. Additional copies are for sale at the Government Printing Office. Revisions are handled in the same way as revisions for the Handbook.

(c) Supervisory committee manual for Federal credit unions. This manual, designated FCU-545, contains auditing procedures to be followed by supervisory committees of Federal credit unions and samples of audit workpapers for the use of committee members. A copy is mailed to each Federal credit union at the time the approved organization certificate is delivered to the incorporators by the Bureau. Additional copies are for sale at the Government Printing Office. Revisions are handled in the same way as revisions for the Handbook.

(d) Credit manual for Federal credit unions. This manual, designated FCU548, contains instructions for members of the credit committee, for loan officers, and for other officials and employees of Federal credit unions. A copy is mailed to each Federal credit union at the time the approved organization certificate is delivered to the incorporators by the Bureau. Additional copies are for sale at the Government Printing Office. Revisions are handled in the same way as revisions for the Handbook.

(e) Federal credit union bylaws. This publication, designated FCU-535, contains the standard Federal credit union bylaws. A copy is mailed to each Federal credit union at the time the approved organization certificate is delivered to the incorporators by the Bureau. Additional copies are for sale at the Government Printing Office. Revisions are handled in the same way as revisions for the Handbook.

(f) Guide to standard amendments to the Federal credit union charter and bylaws. This publication, designated FCU522, is available from BFCU headquarters in Washington or from any regional office.

(g) Organizing a Federal credit union. This booklet, designated FCU-505, contains guidelines for persons considering the organization of a Federal credit union. Copies are furnished to such persons and are available upon request.

(h) Data processing guidelines for Federal credit unions. This booklet, designated FCU-539, contains instructions for use by Federal credit unions utilizing data processing equipment. It is available from BFCU headquarters in Washington or from any regional office. Revisions are announced in the BFCU Bulletin and are made available upon request.

(i) Sale and redemption of U.S. Savings Bonds by Federal credit unions. This booklet, designated FCU-540, contains instructions for Federal credit unions which handle U.S. Savings Bonds. It is available from BFCU headquarters in Washington or from any Regional Office. Revisions are announced in the BFCU Bulletin and are made available upon request.

[33 F.R. 15867, Oct. 26, 1968]

§ 701.15 Other publications.

In addition to the publications listed in § 701.14, the Bureau publishes material on subjects which it believes are of value to Federal credit union officials. These publications include:

(a) BFCU bulletin. A quarterly publication containing news about the Federal Credit Union Program, including changes in regulations and manual revisions. Copies are furnished all Federal credit unions and additional copies may be obtained upon request to BFCU headquarters or any regional office.

(b) Annual report of operations. This publication, designated FCU-561, contains a great deal of statistical material relating to Federal credit unions. Copies are furnished all Federal credit unions and additional copies may be obtained upon request to BFCU headquarters or to any regional office.

(c) Selected operating statistics for Federal credit unions. This publication contains selected Federal credit union statistics and was developed for the information of Federal Credit Union Examiners. It is, however, available for inspection and copying at BFCU headquarters or any regional office.

(d) State-chartered credit unions. This publication, designated FCU-560, contains information furnished BFCU by supervisors of State-chartered credit unions. It is published annually, and may be obtained from BFCU headquarters or from any regional office.

(e) Effective collection procedures for Federal credit unions. This publication, designated FCU-550, contains informa

In order to make available to the public any statements of policy and interpretations which do not appear in the publications set out in § 701.15, and which may be relied on or cited as precedent, the Bureau has established a file in each regional office and at its headquarters. This file, "Statements of Policy and Interpretations for the Public," is available for inspection and copying. [33 F.R. 15868, Oct. 26, 1968]

§ 701.17 List of Federal credit unions. A master list of Federal credit unions, arranged by State, is maintained at BFCU headquarters and is available for inspection and copying. Each regional office maintains a similar list for the States for which it has responsibility. These lists are also available for inspection and copying. In accordance with the regulations of the Department dealing with the creation of records (See § 5.15 of title 45), the Bureau is not required to make available names and addresses of Federal credit unions arranged in any manner other than by State. 133 F.R. 15868, Oct. 26, 1968]

compensated in conformance with the Act and the bylaws, but no Federal credit union shall undertake to administer its own retirement plan.

§ 701.20

Surety bond coverage for Federal credit unions.

(a) The board of directors of each Federal credit union shall at least semiannually, carefully review the bond coverage in force in order to ascertain its adequacy in relation to the exposure and to the minimum requirements fixed from time to time by the Director.

(b) All surety bonds must provide for faithful-performance-of-duty coverage for any officer or employee while performing any of the duties of the treasurer as prescribed in the Act, the bylaws, or rules and regulations of the Bureau.

(c) No form of surety bond shall be used except as is approved by the Director. Credit Union Blanket Bond, Standard Form No. 23 of the Surety Association of America (revised to May 1950), plus Faithful Performance Rider (for use with this form to broaden Insuring Clause (A), Revised to May 1950) shall be considered as the minimum coverage required and is hereby approved. Credit Union Blanket Bond-BFCU Optional Form No. 576 plus Faithful Performance of Duty Rider-Form BFCU 576F is also approved. No other bond form may be used unless specifically approved in writing by the Director. No form of surety bond is approved for use by a Federal credit union having its office outside of the continental United States unless by the terms of the bond or by an appropriate rider attached thereto the provisions of the bond are made applicable within the jurisdiction in which the office of such Federal credit union is located.

(d) All sureties writing Federal credit union bonds must hold a certificate of authority from the Secretary of the Treasury under the act of Congress approved July 30, 1947 (6 U.S.C., secs. 6-13) as an acceptable surety on Federal bonds in the State or jurisdiction concerned.

(e) The schedule of coverage set forth in paragraph (f) of this section shall not be deemed to cover cash funds of $1,000 or more. When the cash fund is $1,000 or more, additional coverage-to the full amount of the fund-will be required.