National Credit Union Administration launches sixth round of Deregulation Project proposals to streamline six federal credit union rules

The National Credit Union Administration announced a sixth round of proposed regulatory changes under its Deregulation Project and is seeking comments on six proposals intended to clarify guidance or remove requirements it views as unduly burdensome or duplicative in the Code of Federal Regulations. The package would remove the requirement that a credit union director have or obtain finance and accounting expertise within six months of appointment, and would clarify loan compensation requirements by defining “overall financial performance” and expanding an exception for incentive or bonus payments to include a senior management employee. For eligible obligations, the proposals would align purchase-policy requirements for eligible obligations and notes of liquidating credit unions with the purchasing federal credit union’s internal written policies, give boards authority to set limitations in written sale policies, and delete 12 CFR 701.23(g) on payments and compensation on the basis that broader conflict-of-interest and fiduciary-duty requirements already apply. The NCUA would also delete standalone regulations on refunds of interest on loans (as duplicative of the Federal Credit Union Act), credit union service contracts (as superfluous), and certain definitional text related to statutory liens to simplify the rule. Comments are to be submitted via the Federal Rulemaking Portal by searching the relevant docket numbers for each notice of proposed rulemaking.