WASHINGTON — America’s Credit Unions has voiced support for two separate proposed regulatory changes by the National Credit Union Administration, saying both measures would simplify compliance requirements and reduce regulatory burdens for federally insured credit unions.
In two comment letters submitted to the NCUA on July 6, the trade group endorsed the agency’s proposal to streamline insurance regulations and backed a separate proposal to significantly increase asset thresholds governing management interlocks under the Depository Institution Management Interlocks Act.
Response to Proposed Rule on Insurance
On the proposed rule addressing requirements for insurance, America’s Credit Unions said it supports the agency’s effort to reorganize and simplify regulations without changing existing compliance obligations.
The association said consolidating and relocating regulatory provisions would make the rules easier for federally insured credit unions to navigate by eliminating duplicative cross-references that offer little practical value.
The group also responded to two questions posed by the NCUA regarding whether certain regulations should more clearly distinguish between provisions that apply to federal credit unions and those that apply to federally insured, state-chartered credit unions.
- America’s Credit Unions said the agency should explicitly state within its regulations when provisions apply only to federal credit unions rather than requiring institutions to infer applicability through cross-references elsewhere in the regulatory code.
- The organization also supported clarifying which provisions governing involuntary liquidation and creditor claims apply to federally insured state-chartered credit unions versus federal credit unions. It said clearer language would reduce uncertainty and prevent compliance staff from spending unnecessary time determining whether specific requirements apply to their institutions.
“Overall, these proposals, along with the removal of other provisions that merely cross-reference other sections, would meaningfully reduce compliance burdens for our members,” Tyler Maron, regulatory advocacy counsel for America’s Credit Unions, wrote in the letter.
Feedback on DIMIA
In a separate filing, the organization also endorsed the NCUA’s proposal to raise the asset thresholds used to determine when the management interlocks restrictions under the Depository Institution Management Interlocks Act apply.
The current rule generally prohibits management officials at unaffiliated depository institutions above certain asset levels from serving simultaneously at another large institution. The existing thresholds — $1.5 billion and $2.5 billion in assets — were established in 1996.
America’s Credit Unions said increasing both thresholds to $10 billion is appropriate because the banking industry has grown substantially over the past three decades. The association noted the NCUA’s proposal cites a more than 341% increase in assets at depository institutions between the fourth quarter of 1996 and the fourth quarter of 2024.
289 CUs Would be Exempted
The trade group also said the proposed change would align the NCUA with other federal banking regulators, which raised their own management interlock thresholds to $10 billion in 2019.
According to the NCUA’s proposal, increasing the lower threshold to $10 billion would exempt 289 credit unions from the major assets prohibition, leaving only 20 credit unions subject to the restriction based on year-end 2024 data.
America’s Credit Unions said exempting institutions under the new threshold would eliminate the need for many credit unions to seek exemptions from the NCUA and make it easier for institutions with less than $10 billion in assets to recruit and retain qualified directors and senior management officials.
“America’s Credit Unions supports the proposed increase to the major assets prohibition thresholds and urges the Board to adopt it,” James C. Akin, the organization’s head of regulatory advocacy, wrote in the second comment letter.
