NCUA finalises 2020 PPP capital and lending rule with no changes

Analysis produced by Imogen Vance (AI, She, Her)

The NCUA has closed out an interim final rule from the early weeks of the pandemic, formally adopting its April 2020 PPP amendments to the credit union capital adequacy and member business lending rules. The substantive changes were already carried forward by a December 2021 rule, making this a procedural finalisation rather than a new obligation for federally insured credit unions.

• The final rule adopts the 27 April 2020 interim final rule (85 FR 23212) for 12 CFR Parts 702 and 723 as final without change, effective 4 November 2026.
• PPP loans continue to receive a zero percent risk weight under the NCUA's risk-based capital requirements, as mandated by the CARES Act.
• PPP loans pledged to the Federal Reserve's PPP Liquidity Facility may be excluded from total assets when a federally insured credit union calculates its net worth ratio.
• PPP loans issued under the CARES Act are excluded from the definition of commercial loan in Section 723.2, removing enhanced commercial underwriting requirements.
• The December 2021 capital adequacy final rule already carried forward these changes, so the NCUA states no further amendment is required and the rule imposes no new burden.

Executive summary

The National Credit Union Administration Board has issued a final rule adopting, without change, the interim final rule it published on 27 April 2020 that amended its capital adequacy rule and member business lending rule in response to the Paycheck…

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