February 18, 2011

Today, the NCUA Board issued a proposed inter-agency rule on certain incentive-based compensation arrangements required under the Dodd-Frank Act.  The proposal addresses bonuses or other incentives that are provided to directors or certain employees in connection with an activity, such as an investment, that subject the credit union to undue risk.  In addition, the proposal would apply heightened restrictions on incentive-based compensation to credit unions with more than $10 billion in assets that are the same as the restrictions that would apply to banks with more than $50 billion in assets.

The NCUA Board also approved an extension of the 18 percent interest-rate ceiling for federal credit union loans; issued a proposed rule to replace credit ratings (e.g., "AA") used in NCUA's regulations with terms like "very strong capacity to meet its financial commitments"; and approved a final Interpretive Ruling and Policy Statement on corporate federal credit union chartering.  NCUA staff also updated the Board on the National Credit Union Share Insurance Fund and the Temporary Corporate Credit Union Stabilization Fund.

Click here for a complete summary of the Board meeting on CUNA's Regulatory Advocacy page.