Newsroom
NAFCU suggests NCUA allow flexibility on compensation programs
NAFCU – in a letter sent Friday – offered suggestions to improve the NCUA's rules on compensation in connection to lending. The NCUA in April issued an advanced notice of proposed rulemaking seeking public feedback on proposed changes.
The association also asks that the agency explicitly permits lending as a factor in compensation plans.
"NAFCU proposes several amendments to carry out the NCUA's intent while allowing credit unions the flexibility necessary to implement compensation plans that work best for their unique business models, including redefining 'overall financial performance' to include loan growth as part of the calculation," wrote NAFCU Regulatory Affairs Counsel Mahlet Makonnen. "Modernizing these regulations is critical for credit unions' governance because it will allow them to build well-balanced incentive plans that attract and retain talented employees and executives to help credit unions grow and better serve their communities."
Suggestions outlined in the letter include:
- modernizing section 701.21 (C)(8); and
- flexibility to develop methodology for compensation plans.
Makonnen also noted that while current regulations contain NAFCU-supported protections against conflicts of interest and also establish a framework to prevent loss to the National Credit Union Share Insurance Fund, "the compensation rule could be substantially improved by the recommendations below to incorporate lending as part of a broad and balanced set of organizational goals and performance measures."
For more on lending compensation rules, read a post on NAFCU's Compliance Blog here.
Share This
Related Resources
Resiliency In Your Incident Response Plan
Cybersecurity
preferred partner
DefenseStorm
Blog Post
The Bottom Line on Insurance Tracking and Collateral Protection
Strategy
preferred partner
Allied Solutions
Blog Post
Add to Calendar 2024-04-15 09:00:00 2024-04-15 09:00:00 Mergers and Acquisitions: Unifying Two Different Executive Total Compensation and Benefits Programs Listen On: Key Takeaways: [03:50] With the merger of a smaller credit union into a larger one you are really only dealing with integrating staff into the larger credit union. [05:53] When working with a merger of equals we start with a deep dive into the executive compensation and benefits of each organization. [09:09] If your current executive benefits provider doesn’t conduct regular plan evaluations, consider having a plan audit anyway. [13:46] Don’t overpay for these things if you don’t have to. When you have more options available that means the cost is more appropriate. [17:11] It is in a unified organization’s best interest to do tier timelines where we look at your top executives who are critical to the unified organization’s success today and then slowly add in the next levels. Web NAFCU digital@nafcu.org America/New_York public
Mergers and Acquisitions: Unifying Two Different Executive Total Compensation and Benefits Programs
preferred partner
Gallagher
Podcast
Add to Calendar 2024-04-11 14:00:00 2024-04-11 14:00:00 Regulation E: Impacts Across Your Institution Dive into regulatory excellence with, Regulation E: Impacts Across Your Institution. This webinar is tailored to empower you with the knowledge and strategies necessary to effectively implement the Electronic Funds Transfer Act (EFTA) and Regulation E within your operations. You’ll explore how to apply Regulation E across various business areas to ensure compliance obligations are met with precision. Key Takeaways Learn the basics of EFTA and Regulation E Understand how to apply Regulation E at your organization to detect processes and transactions that require Regulation E compliance Discover how Regulation E may apply to a large breath of areas in your institutions and functions for which you may rely on third-party vendors Review recent enforcement activity for non-compliance with EFTA and Regulation E Register Now $295 Members | $395 Nonmembers(Additional $50 for USB)One registration gives your entire team access to the live webinar and on-demand recording until April 11, 2025Go to the Online Training Center to access the webinar after purchase » Who Should Attend NCCOs NCRMs Compliance and risk titles Education Credits NCCOs will receive 1.0 CEUs for participating in this webinar NCRMs will recieve 1.0 CEUs for participating in this webinar Web NAFCU digital@nafcu.org America/New_York public
Regulation E: Impacts Across Your Institution
Credits: NCCO, NCRM
Webinar
Get daily updates.
Subscribe to NAFCU today.