A proposed rule on derivatives and a final rule on corporate credit unions are the key regulatory actions slated for the National Credit Union Administration (NCUA) Board’s open meeting Oct. 15, according to an agenda posted Thursday.
Other agenda items include a board briefing on cybersecurity considerations for boards of directors during COVID-19; and a request for information regarding supervisory guidance review and improvements in communications.
The NCUA Board in February proposed rule changes to its corporate credit union regulations (Part 704) to clarify, simplify, and update provisions of the rule. Changes highlighted by the agency included:
- permitting a corporate credit union to make a minimal investment in a credit union service organization (CUSO) without that organization being classified as a corporate CUSO and subject to heightened NCUA oversight;
- expanding the categories of senior staff positions at member credit unions who would be eligible to serve on the corporate credit union’s board;
- amending the prescriptive experience and independence requirements for a corporate credit union’s enterprise risk management expert; and
- clarifying the treatment of an investment in a subordinated debt instrument of a natural-person credit union.
The proposed rule also would allow corporates to invest in subordinated debt instruments issued by credit unions (authority to issue such instruments was proposed in January) under the institution’s lending authority, but the corporate would be required to fully deduct the amount of the instrument from tier 1 capital. It would also remove the minimum experience and independence requirement for a corporate credit union’s enterprise risk management expert.
The NCUA Board’s Oct. 14 meeting is set to begin at 10 a.m. and will be held via audio webcast only, out of an abundance of caution amid the pandemic. No closed meeting appears to be scheduled that day.