The NCUA board held its November open meeting Thursday morning with the field of membership (FOM) proposal being the hot topic. As expected, it passed the board on a 3-0 vote. The proposal is an ambitious update to the field of membership rules. Chairman Debbie Matz said that it is the most comprehensive reform in the history of the NCUA.
The new proposal will allow credit unions to have a major improvement in the definition of “rural district.” It would allow rural district to be comprised of up to one million residents by changing the standard used to measure it. It would also allow a congressional district to be considered a Well-Defined Local Community (WDLC) to support a community charter application and eliminate a geographic limitation on trade, industry, or profession (TIP) charter for federal credit unions with associational common bond memberships.
The proposal is now open for a 60-day comment period. The bankers sent a letter to the NCUA and Congress ahead of the meeting stating their disapproval. It’s expected that the NCUA will hear more from them following Thursday’s meeting. CUNA also sent a letter to Congress correcting some of the misconceptions
Among other items discussed, the NCUA two-year budget was approved on a 2-1 vote, with Mark McWatters casting the dissenting vote. The budget is set at $290 million dollars for next year and $302 million for 2017. The 2016 budget includes reducing staff by 21. The board also announced that no premiums or assessments will be done in 2015. The board also believes that they are not likely in 2016 either.
The NCUA will have same exam schedule for 2016, but Chairman Debbie Matz said she was flexible to consider an 18-month exam period in the future. She said the agency needs better systems in place before it can happen. For 2016, NCUA examiners will rely more on state examiners for healthy credit unions under $250 million in assets.