NCUA’s Tenth Round of Deregulation Proposals

The National Credit Union Administration (NCUA) announced the 10th round of proposed regulatory changes associated with NCUA’s Deregulation Project. The project is an ongoing review of NCUA’s regulations to ensure regulations are focused on credit unions’ safety, soundness, and resilience.

With today’s announcement, NCUA is requesting comments on a proposal that would clarify agency guidance and eliminate unduly burdensome and duplicative requirements in the Code of Federal Regulations related to bank conversions and mergers. These changes are intended to allow a credit union’s board of directors to exercise its fiduciary duties and business judgement rather than imposing a rigid, agency-defined process.

The proposal includes:

Bank Conversions and Mergers – Merger of Insured Credit Unions into Banks – 12 CFR 12 CFR 708 A Subpart C

Change 1: Remove the definition of “clear and conspicuous” from 12 CFR 708a.301

• Impact on credit unions: Removing this definition will allow credit unions the flexibility to design disclosures that are effective and clear for their members.

Change 2: Revise the newspaper publishing requirement in 12 CFR 708a.303(b)(1)

• Impact on credit unions: This proposal would eliminate an outdated and possibly costly requirement. It would also make pre-board-vote notices more accessible to members who can find that information directly on the homepage of the credit union’s website.

Change 3: Revise the due diligence reporting requirements in 12 CFR 708a.304(d)

• Impact on credit unions: This proposed change streamlines the reporting requirements, focusing on the substantive outcome of the board’s decision-making process.

Change 4: Remove highly prescriptive formatting requirements in 12 CFR 708a.305(e)(2)

• Impact on credit unions: Eliminating these specific formatting rules will reduce administrative burden.

Change 5: Remove plain language determining factors in 12 CFR 708a.305(f)

• Impact on credit unions: This proposal would simplify compliance and credit unions would have more flexibility in their merger communications.

Change 6: Remove “Voting guidelines” from 12 CFR 708a.312

• Impact on credit unions: This proposal would remove guidance from regulation so that credit unions aren’t confused about what is required.

To submit comments, type or paste the docket numbers into the search on the Federal Rulemaking Portal.

For more information about the NCUA Deregulation Project, click here.

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