Federally chartered credit unions will lose the “flexibility” at year’s end to hold their membership and director meetings completely virtually, their regulator told them Wednesday.
The National Credit Union Administration (NCUA), in a letter to federal credit unions (FCUs), said that it had offered the credit unions the ability to hold the annual meetings virtually in the face of the coronavirus crisis. The offer was made three times: in March 2020, November 2020, and November 2021.
Specifically, for credit unions choosing to hold virtual annual meetings, they were required to adopt, by a two-thirds vote of its board and without additional NCUA approvals, a bylaw amendment to Article IV of the NCUA’s FCU Bylaws. The letters to federal credit unions provided specific wording for the bylaw amendment, the agency noted.
However, according to the letter issued Wednesday, that option ends at year’s end.
“The NCUA does not believe that current circumstances continue to warrant federal credit unions to invoke the subject bylaw provision beyond year-end 2022,” the agency wrote in its letter 22-FCU-03 . “Federal credit unions that have already adopted the bylaw amendment may retain it in their bylaws, but it will not be applicable after the end of 2022 unless NCUA issues a new notification allowing federal credit unions to invoke it.”
The credit unions may still hold “hybrid” meetings, NCUA said, if that suits their needs. Hybrids consist of meetings held virtually in conjunction with an in-person component for members who wish to or need to attend that way.
“While general quorum requirements still must be met for hybrid meetings, federal credit unions may count attendees at both the virtual and in-person components toward those requirements,” the agency said. NCUA suggested that the hybrid meeting format could preserve FCU resources and reduce the effort required to hold meetings without disenfranchising those members for whom virtual attendance is difficult or impossible. Whether current bylaws authorize hybrid meetings or whether bylaw changes will be necessary should also be considered by the credit union, NCUA said.
The NCUA letter also noted that:
- FCUs may conduct “virtual-only” meetings for all but one of their board meetings per calendar year.
- When a quorum of directors is physically present at the one required in-person meeting, then the remaining directors may attend that meeting virtually.3
- NCUA’s Bylaws for FCUs permit flexibility for distributing member notices in that notices for member meetings may be sent by electronic mail to members who have opted to receive statements and notices electronically. A paper mailing is not required for all members, only those members who have not opted to receive electronic statements and notices, NCUA stated.