Catalyst News

Catalyst Corporate Invests in the CLF

by Catalyst Corporate | May 12, 2020

To help member credit unions with assets less than $250 million access contingency liquidity, Catalyst Corporate Federal Credit Union invested $91 million into NCUA’s Central Liquidity Facility (CLF) Agent Subscription Program on May 8, 2020.

Provisions in the recently passed CARES Act, together with authorization from NCUA, enabled Catalyst Corporate to capitalize the CLF through the Agent Subscription Program on behalf of member credit unions with assets under $250 million. This will make it easier for credit unions to access funds if they are experiencing unusual or unexpected liquidity shortfalls.

The CLF is a mixed-ownership, government corporation created to improve financial stability by serving as a liquidity lender to credit unions.

Acting as an agent, Catalyst Corporate can now assist “represented credit unions” with requesting an advance from the CLF and processing required documentation. Catalyst Corporate can also facilitate the transfer of CLF loan funds (and repayment amounts) as part of its general settlement process between the CLF and a credit union’s account with Catalyst Corporate. For now, the measure is temporary and set to expire on December 31, 2020.

The 812 member credit unions that were represented in the agent subscription will be notified that they have access to the CLF in the event they have a liquidity event.

“Catalyst Corporate is thankful NCUA reinstated this program that allows us to better serve our member credit unions,” said Jeff Hamilton, Catalyst Corporate’s Vice President of Member Credit. “Our organization has been able to assist credit unions that are direct ‘regular members’ of CLF for a long time through our CLF correspondent relationship, but this new action extends support to far more credit unions.”

Details regarding how credit unions with less than $250 million in assets can now access the CLF can be found here.