|Organization:||Division of Banks|
|Referenced Sources:||Chapter 343 of the Acts of 2014|
To the Chief Executive Officer of the Credit Union Addressed:
On October 9, 2014, Bill H. 3954 was signed into law by Governor Deval Patrick as Chapter 343 of the Acts of 2014 (Chapter 343). Chapter 343 amends several sections of the Massachusetts General Laws as it pertains to the Legal List of Investments (Legal List). Chapter 343 goes into effect on January 9, 2015.
The new law can be found here. Each credit union is encouraged to read Chapter 343 in its entirety to gain a better understanding of how these changes affect your institution’s investment strategies. However, there are some significant changes that you should be aware of, particularly those that concern applying to the Commissioner of Banks for investment authority. The two more significant changes pertain to Chapter 167, §15B (c), relating to petitioning the Commissioner to invest in stocks, and Chapter 171, § 67B, relating to the prudent person investment authority.
Additionally, Chapter 343 includes a revision to the amount that a credit union may invest in the obligations of the Legal List. Prior to these changes, credit unions were limited to investing 10% of shares and deposits in Legal List investments. Chapter 343 changes that limit to 10% of assets (Chapter 167, §15B (g)).