12 CFR §703.103

1. (a)Under this subpart, a Federal credit union may only enter into Derivatives that have the following characteristics:
   1. (1)Are for the purpose of managing Interest Rate Risk;
   2. (2)Denominated in U.S. dollars;
   3. (3)Based on Domestic Interest Rates or the U.S. dollar-denominated London Interbank Offered Rate (LIBOR);
   4. (4)A contract maturity equal to or less than 15 years, as of the Trade Date; and
   5. (5)Not used to create Structured Liability Offerings for members or nonmembers.
2. (b)A Federal credit union may not engage in embedded options required under U.S. Generally Accepted Accounting Principles (GAAP) to be accounted for separately from the host contract.