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CUNA Seeks Comments on NCUA Voluntary Merger Proposal
Monday, June 12, 2017 6:40 AM

Credit Union National Association has issued a comment call on National Credit Union Administration’s proposed rule revising procedures for voluntary rules among federal credit unions. Comments are due to NCUA by Aug. 7, and can be sent to CUNA through Aug. 7 as well.

The NCUA board issued the proposed rule at its May meeting, and it appeared in the Federal Register Thursday.

Specifically, the rule:

  • Revises and clarify the contents and format of the member notice;
  • Requires merging federal credit unions to disclose all merger-related financial arrangements for covered persons;
  • Increases the minimum member notice period;
  • Provides procedures to allow reasonable member-to-member communications regarding the proposed merger; and
  • Makes conforming amendments regarding termination of insurance when the surviving credit union is not a federal credit union.

CUNA is especially interested in comments on certain provisions that are a departure from the current rule as follows:

  • The definition of “covered person” which is proposed to expand the class of persons subject to disclosure in the merger process beyond the current senior management and the board; 
  • The proposed definition of “merger-related financial arrangement” will change the disclosure threshold for a “material increase” in compensation to the proposed standard of "any increase in compensation for a covered person"; and
  • The member-to-member communications proposal that will require a federal credit union to distribute communications received from a member to all members as part of the voting process. The FCU will need to administer the communications process at the expense of the member. 

Read more and comment here.