Comments on NCUA’s Proposed Compensation in Connection with Loans to Members and Lines of Credit to Members Due Jun 24

Comments on the NCUA’s proposed rule on compensation connected with loans and lines of credit to members are due by the close of business on June 24. The NCUA Board issued an advance notice of proposed rulemaking (ANPR) to solicit comments on ways to improve the agency’s regulations limiting a credit union official’s and employee’s compensation in connection with loans and lines of credit to members. (An ANPR helps inform the agency before they begin drafting a proposed rule.)

In its final Regulatory Reform Task Force report, the NCUA outlined its blueprint for implementing the agency’s regulatory reform agenda. One of the Agenda’s recommendations specifically suggested that the Board modify its regulations to ‘‘provide flexibility with respect to senior executive compensation plans that incorporate lending as part of a broad and balanced set of organizational goals and performance measures.’’ The Board recognizes that the NCUA’s regulations in this area, which were last updated over 20 years ago, are likely outdated, burdensome, and at odds with industry standards for senior executive compensation plans. As such, the Board is seeking comment on how to update the regulations so that credit unions can offer competitive compensation plans without encouraging inappropriate risks, incentivizing bad loans, or negatively effecting safety and soundness.

Click here to submit your comments.