CUNA Comment Letter

Proposed Rule Regarding Safe Deposit Box Service

March 5, 1999

Ms. Becky Baker
Secretary of the Board
National Credit Union Administration
1775 Duke Street
Alexandria, Virginia 22314-3428

RE: Proposed Rule Regarding Safe Deposit Box Service (12 C.F.R. § 701.30)

Dear Ms. Baker:

The Credit Union National Association (CUNA) appreciates the opportunity to comment on NCUA's proposed rule regarding safe deposit box service. CUNA represents more than 90% of our nation's 11,000 state and federal credit unions.

Currently, section 701.30 of NCUA's regulations provides that a federal credit union may lease safe deposit boxes to its members. NCUA proposes to eliminate this section because under § 107 of the Federal Credit Union Act (FCUA), federal credit unions have the authority to exercise necessary incidental powers. Section 701.30 of NCUA's regulations is unnecessary because the leasing of safe deposit boxes is an incidental power permissible under § 107 of the FCUA.

CUNA strongly supports the proposed rule, which would eliminate an unnecessary section from NCUA's regulations. The proposed rule was a result of IRPS 87-2, Developing and Reviewing Government Regulations, which sets forth NCUA's policy of continually reviewing regulations to "update, clarify, and simplify existing regulations and eliminate redundant and unnecessary provisions." CUNA strongly supports NCUA's efforts to review other regulations that may be outdated, redundant, or would otherwise inhibit the ability of credit unions to offer financial services to their members.

Thank you for the opportunity to comment on the proposed rule regarding safe deposit box service. If you or your staff have any questions about our comments, please give me a call at 202-718-7795.

Sincerely,

Jeffrey Bloch
Assistant General Counsel for
Regulatory Advocacy