Final rules on member expulsion and proposed rules on field of membership and trust accounts are two actions from last year highlighted by the federal credit union regulator in its 2023 annual report, released Monday.
The National Credit Union Administration (NCUA) also said a third major action involved proposed changes, made in July 2023, to the interpretive ruling and policy statement (IRPS) on the agency’s Minority Depository Institution Preservation Program (MDIPP).
In July last year, the NCUA Board approved a rule giving federal credit union (FCU) boards authority to expel a member for cause; the rule took effect Aug. 25. Under the rule (made possible by a law passed by Congress in 2022 and proposed to deal with violent or abusive members), an FCU’s board may expel a member on a two-thirds vote of a quorum of the institution’s board of directors.
The field of membership proposal was issued in February 2023, which amended agency rules through nine changes the agency said were meant to “enhance consumer access to safe, fair, and affordable financial services, especially in under-resourced communities.” The proposal would also reduce duplicative or unnecessary paperwork and administrative requirements, the agency said. The 60-day comment period on the proposal closed on May 30.
According to the NCUA, the trust accounts proposal, made last October, would simplify share insurance regulations by establishing a “trust accounts” category. The proposal would provide National Credit Union Share Insurance Fund (NCUSIF) coverage of funds in both revocable and irrevocable trusts deposited at federally insured credit unions in the accounts of members or those otherwise eligible to maintain insured accounts. The 60-day comment period closed on Dec. 26.
The MDIPP proposal, according to the NCUA, would, among other things, clarify the requirements for a credit union to receive and maintain an MDI designation. That includes, the NCUA said last June when the proposal was made, providing examples of technical assistance an MDI may receive, establishing a new standard for MDIs to assess their designation periodically, and updating how the NCUA will review an MDI’s designation status. The proposal was issued with a 60-day comment period, which closed last September.