Credit Union Exam Solutions Presents With Flying Colors The NCUA Central Liquidity Facility and What You Need to Know
Jul 3, 2025
Steve Farrar, former VP of the Central Liquidity Facility (CLF) at NCUA, shares his vast knowledge of this essential government entity. He explains how the CLF supports credit unions during financial crises, drawing insights from historical events like the Great Recession. The discussion also covers enhancements from the CARES Act, membership benefits for natural person credit unions, and strategies for effective liquidity management. Farrar emphasizes the importance of continuous liquidity support for credit unions facing economic challenges.
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CLF Role as Liquidity Backstop
- The CLF serves as a federal liquidity backstop for credit unions during tight liquidity periods.
- It borrows from the Federal Financing Bank to support liquidity needs, proven vital in the 2008-2009 crisis.
Liquidity Requests Scaling Up
- Mark Treichel shared his personal experience increasing liquidity requests from $300 million to $10 billion rapidly.
- This demonstrated how critical and scalable the CLF's support can become in crises.
Study CLF Financial Footnotes
- Review the CLF audited financial statements and footnotes for in-depth understanding.
- These documents reveal details often overlooked but valuable for grasping CLF operations.