THE WORKS Blog, Credit Union Compliance News & Views

      Giving Credit Where Credit is Due

      By Jeremy Smith · May 02, 2018

      I figured this week I would take a different tone compared to my last blog. I mean come on, should a person really be that fired up over a simple name change. Let’s be honest, with how the CFPB has operated over the last few years I really shouldn’t be that surprised. No, this week I want to shine the light on the light guy - the good ole NCUA.

      Back on April 19, the NCUA held its fourth board meeting for 2018. In that meeting the Board approved two pretty significant items. The first rule that they approved was in regard to the stress testing rules for federally insured credit unions. Under this new rule, credit unions with less than $20 billion in assets will still be required to develop annual capital plans, but they will no longer have to submit those plans to the NCUA each year by May 1. Those above the $20 billion mark will still have to submit those plans. The rule also removes the requirement that the NCUA will have to conduct supervisory stress tests. Instead, credit unions that are subject to the rule will conduct those tests themselves. The caveat there is that the NCUA reserves the right to conduct a stress test if they deem it is necessary. The final rule also states that credit unions with less than $15 billion in assets will no longer be required to conduct stress testing. Those above the $15 billion mark will be required to conduct a stress test, and those that are above $20 billion will be subject to a 5% minimum stress test capital ratio.

      Advertising was the other area where we got some relief. Under the final rule a credit union has a fourth option for using the NCUA official statement. With the new rule a credit union can include “Insured by NCUA” within their ads. The other piece that they threw in there was expanding the exemption from the advertising statement for radio and television ads from 15 seconds to 30. They also removed the requirement for including that advertising statement on your annual reports and statement of conditions that are required by law. I’ll be honest, I never quite understood that last one but hey, you got to give them some credit for making that move.

      In my opinion, the NCUA is actually a great example for how the regulatory bodies could/should be working together to help make an efficient and effective compliance landscape. It is a board that is made up of two members that are on different sides of the political fence, but they are still able to work together to find solutions. Maybe Washington should pay a little more attention to those operating in their own backyard.