ALEXANDRIA, Va. ― NCUA has announced the tenth round of proposed regulatory changes as part of its Deregulation Project, this time involving bank conversions and the merger of insured credit unions into banks, including the removal of voting guidelines.
The latest proposal comes on the heels of another proposal from NCUA related to converting credit unions to mutual savings bank charters, as the CU Daily reported here.
In its latest request, the agency is seeking comments on a proposal that would clarify agency guidance and eliminate what it said are “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 agency said.
NCUA said the changes include:
Change 1: Remove the definition of “clear and conspicuous” from 12 CFR 708a.301.
Impact on credit unions: “Removing this definition would enable credit unions the flexibility to design disclosures that are effective and clear for their members,” NCUA said.
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Impact on credit unions: “This proposal would eliminate an outdated and potentially costly requirement,” NCUA said. “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 would streamline the reporting requirements, focusing on communicating the substantive outcome of the board’s decision-making process,” according to NCUA.
Change 4: Remove highly prescriptive formatting requirements in 12 CFR 708a.305(e)(2).
Impact on credit unions: “Eliminating these formatting rules would reduce administrative burden,” NCUA said.
Change 5: Remove plain language determining factors in 12 CFR 708a.305(f).
Impact on credit unions: “Compliance would be simplified, and credit unions would have more flexibility in their merger communications,” according to the agency.
Change 6: Remove “Voting guidelines” from 12 CFR 708a.312.
Impact on credit unions: This proposal would remove guidance from the regulation to clarify what is actually required,” NCUA said.
How to Submit Comments
To submit comments, type or paste the docket numbers into the search on the Federal Rulemaking Portal.
Additional information on the Deregulation Project can be found here.
For more information about the NCUA Deregulation Project, go here.
