The National Credit Union Administration (NCUA) cites a January White House memorandum in a recent notice inviting input from the public on two final regulations – “Simplification of Share Insurance” and “Succession Planning” – that are set to take effect next year.
The request by the NCUA Board for comments was published in the Federal Register Wednesday, about one week following the news that the agency’s two Democratic board members, Todd Harper (also a former chairman) and Tanya Otsuka, had been fired and Republican Kyle Hauptman, current chairman, left as the sole agency board member. It reads as having been issued “by the NCUA Board” April 17.
The NCUA, in its notice, said the public comment period “will allow interested parties to provide comments about issues of fact, law, and policy raised by the two final rules.” That language, “issues of facts, law, and policy,” appears to have been lifted from one of the scenarios the White House outlined in its Jan. 20 memo, “Regulatory Freeze Pending Review,” in identifying rules that should be reviewed by the Office of Management and Budget (OMB) prior to implementation.
The NCUA Board approved both rules by unanimous (3-0) vote, the agency reported then.
The share insurance rule, published Sept. 30, 2024, is set to take effect Dec. 1, 2026. Among other things, it established a “trust account” category for share insurance, providing for coverage of funds in both revocable and irrevocable trusts deposited at federally insured credit unions in the accounts of members or those otherwise eligible to maintain insured accounts. The rule was adopted in part to bring it in line with deposit insurance rules of the Federal Deposit Insurance Corp. (FDIC).
The succession planning rule, published Dec. 26, 2024, is set to take effect Jan. 1, 2026. This rule requires federally insured credit union boards of directors to establish succession planning processes for key positions. The agency had noted that the rule, in part, addresses situations that may arise when failure to have such a plan leads to an unplanned merger of two institutions.
Comments on the rules are due June 23.
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