The second round of the federal credit union regulator’s “deregulation project” was released this week, with four of the agency’s rules proposed for either deletion or revision.
The National Credit Union Administration’s (NCUA) deregulation project is being rolled out in conformance with a Jan. 31 White House executive order (14192), “Unleashing Prosperity Through Deregulation.” (That order called for, among other things, the removal of 10 regulations for every new one proposed; and said all new rules should have an incremental cost “significantly less than zero.”)
The NCUA’s latest batch of targeted rules includes those the agency says is obsolete, overly burdensome or duplicative of other requirements. The agency proposes:
- removal of the segregated deposit and collateral requirements [12 CFR 701.20(c)(3) and 701.20(d)] when a federally insured credit union (FICU) acts as a surety and guarantor (calling the requirements “obsolete” and “overly burdensome”);
- removal of regulations related to approval and policies on making loans to other credit unions [12 CFR 701.25(b)] (calling the requirements “overly burdensome” and “duplicative of statute”);
- to amend the requirements for federally insured credit unions (FICUs) to report catastrophic acts to the agency, providing more time for notification and eliminating the specific list of items to be documented [12 CFR 748.1(b)] (calling the requirements “overly burdensome”); and
- to streamline regulations governing advertising and the notice of insured status by eliminating provisions concerning the official advertising statement (but leaves intact the requirement to display the officials sign) [12 CFR 740.0 and 740.5] (calling the targeted requirements “obsolete” and “overly burdensome”).
The proposed changes were released under the auspices of agency board (and Republican appointee) Chairman Kyle Hauptman, now the sole board member. The other two board members, both Democrats, were fired by President Donald Trump (R) earlier this year. The Democrats have challenged their firings in federal court, but an appeals court blocked their return to the board.
Comments on all four proposals are due Feb. 27, according to notices in the Federal Register.
NCUA Announces Second Round of Deregulation Proposals
Executive Order 14192, “Unleashing Prosperity Through Deregulation”
Federal Register notice, suretyship and guarantor requirements
Federal Register notice, loans to other credit unions
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