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NCUA Issues Proposed Rule on Succession Planning
Michael Christians • February 6, 2022
On February 3rd, the National Credit Union Administration (NCUA) issued a proposed rule that would require the board of directors of each federally chartered credit union (FCU) to establish and adhere to processes for succession planning.
Under the proposed rule, each FCU's board of directors would be required to approve a written succession plan applicable to officers of the board, management officials and members of the executive, supervisory and credit committees.
Each FCU's succession plan must include, at a minimum:
- Identification of key positions covered by the plan,
- The general competencies and skills required for those positions, and
- Strategies to fill vacancies.
Comments on the proposed rule must be received by April 4, 2022.
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In Letter to Credit Unions 25-CU-03 , the National Credit Union Administration (NCUA) announced its new exam scheduling policy. Effective January 1, 2025, federally insured credit unions (FICUs) will be examined according to the following schedule: 8 to 12 months following its last examination date FICUs with ANY of the following characteristics - A CAMELS rating of 3, 4, or 5, Considered less than well capitalized, An outstanding enforcement action, or Assets greater than or equal to $10 billion. FICUs with assets between $1 billion and $10 billion, and A CAMELS rating of 3, 4, or 5, or A change in CEO since its last examination. 12 to 16 months following its last examination date FICUs with assets between $1 billion and $10 billion, and A CAMELS rating of 1 or 2, and No change in CEO since its last examination. 14 to 18 months following its last examination date Federal credit unions (FCUs) not included above Once every 5 years Federally insured state-chartered credit unions (FISCUs) not included above The NCUA believes this revised schedule will allow it to better respond to emerging risks and priorities using available resources. It is important to note that nothing in the new schedule limits the NCUA's authority to examine any FICU as frequently as the agency deems necessary.
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Michael Christians Consulting, LLC
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