A final rule revising parts of the federal credit union regulator’s rules allowing an option to make television and radio advertising less cumbersome, and making other changes, was approved Thursday by the agency’s board.
The National Credit Union Administration (NCUA) Board approved the new rule giving federally insured credit unions a fourth, shorter version (expanded from the three versions now in force) of the agency’s official statement, allowing the credit unions to state (simply) “insured by NCUA.”
The new rule takes effect 30 days after publication in the Federal Register.
Under NCUA rules, in most cases federally insured credit unions (FICUs) must use the NCUA’s official statement when advertising; previously, three versions of that statement were permitted: “This credit union is federally insured by the National Credit Union Administration” (the agency’s official advertising statement); the shorter version, “Federally insured by the NCUA”; and, as a third option, the official sign may be displayed in advertisements in lieu of the advertising statement.
In adding the fourth option, NCUA said it is providing regulatory relief to credit unions and is focusing on the exemptions relating to radio and TV advertisements that are less than 15 seconds in duration.
“For many years, NCUA’s advertising and official sign regulations were essentially the same as those of the Federal Deposit Insurance Corporation (FDIC),” agency staff told the board. In 2011, staff added, the board amended its advertising rule, making it “more stringent” than FDIC’s rules. “Specifically, in 2011, while banks needed only to include the FDIC advertising statement in radio and television ads that exceeded 30 seconds, the 2011 NCUA rule change required FICUs to include NCUA’s official advertising statement in radio and television ads that exceeded 15 seconds.
“This additional requirement, which the Board now believes is unnecessary, affected more FICU ads and disrupted the balance between bank and FICU regulatory burden in this context,” staff added. “According to some FICUs, it also made it more difficult for FICUs to produce effective ads.”