---
kind: "section"
citation: "12 C.F.R. § 703.19"
title: "12"
number: "703.19"
heading: "Investment pilot program."
url: "https://uscodex.org/cfr/12/703.19"
---

# §703.19. Investment pilot program.

- (a) Under the investment pilot program, NCUA will permit a limited number of Federal credit unions to engage in investment activities prohibited by this part but permitted by the Act.
- (b) Except as provided in [paragraph (c)](#c) of this section, before a Federal credit union may engage in additional activities it must obtain written approval from NCUA. To obtain approval, a Federal credit union must submit a request to its regional director that addresses the following items:
  - (1) Certification that the Federal credit union is “well-capitalized” under [part 702](/cfr/12/part702.md) of this chapter;
  - (2) Board policies approving the activities and establishing limits on them;
  - (3) A complete description of the activities, with specific examples of how they will benefit the Federal credit union and how they will be conducted;
  - (4) A demonstration of how the activities will affect the Federal credit union's financial performance, risk profile, and asset-liability management strategies;
  - (5) Examples of reports the Federal credit union will generate to monitor the activities;
  - (6) Projections of the associated costs of the activities, including personnel, computer, audit, and so forth;
  - (7) Descriptions of the internal systems that will measure, monitor, and report the activities;
  - (8) Qualifications of the staff and officials responsible for implementing and overseeing the activities; and
  - (9) Internal control procedures that will be implemented, including audit requirements.
- (c) A third-party seeking approval of an investment pilot program must submit a request to the Director of the Office of Capital Markets and Planning that addresses the following items:
  - (1) A complete description of the activities with specific examples of how a credit union will conduct and account for them, and how they will benefit a Federal credit union;
  - (2) A description of any risks to a Federal credit union from participating in the program; and
  - (3) Contracts that must be executed by the Federal credit union.
- (d) A Federal credit union need not obtain individual written approval to engage in investment activities prohibited by this part but permitted by statute where the activities are part of a third-party investment program that NCUA has approved under this section.

## Notes

### Amendments

[68 FR 32960, June 3, 2003, as amended at 69 FR 39832, July 1, 2004; 70 FR 55517, Sept. 22, 2005]

### Authority

Authority: 12 U.S.C. 1757(7), 1757(8), 1757(14) and 1757(15).

### Source

Source: 68 FR 32960, June 3, 2003, unless otherwise noted.

### Amendments

[68 FR 32960, June 3, 2003, as amended at 69 FR 39832, July 1, 2004; 70 FR 55517, Sept. 22, 2005]