NCUA's Spring 2022 Rulemaking Agenda - a Mid-Year Refresh

In January, we published a “New Year’s Resolutions” series, on the rulemaking agendas of FinCEN, the CFPB, and NCUA. Earlier this week, the agencies published their Spring 2022 Rulemaking Agendas, which we can think about as a sort of mid-year refresh of those resolutions that were made at the beginning of the year. In this post, we’ll focus on what the NCUA plans to accomplish for the rest of the year.

Here is an update to January’s post, which includes updates to the previous agenda items and some new actions we can look forward in the remainder of 2022 and into 2023:

Automated Valuation Models (AVMs): NCUA and other federal regulators are planning to solicit comments via a proposed rule that would “implement quality control standards for the use” of AVMs by mortgage originators and the secondary market. The Fall Agenda noted that a Notice of Proposed Rulemaking (NPRM) could be expected in November 2021; however, that timeline was not met. The Spring Agenda provides an updated timeline, and states that an NPRM may be expected in October 2022.
Investment and Deposit Activities: In another update from the Fall Agenda, the Spring Agenda notes that an NPRM on a proposed rule to “provide federal credit unions with more flexible investment options” by amending part 703 “to modernize and improve the NCUA’s investment rule and to provide regulatory relief” can be expected in September 2022.
Purchase, Sale, and Pledge of Loans: This proposed rule was predicted to be published around April 2022, but the Spring Agenda updates the timeline to June 2022. However, no such NPRM has yet been published. According to NCUA, it would “clarify federal credit unions' authority to purchase, sell, and pledge loans - including loan participations and eligible obligations.” Notably, loan participations are one of NCUA’s Supervisory Priorities for 2022, including encouraging credit unions to “utilize safe-and-sound practices as they manage their loan participation portfolios.”
Compensation in Connection with Loans to Members and Lines of Credit to Members: NCUA expected to issue a proposed rule around April 2022, which was updated in the Spring Agenda to September 2022. This will modernize the agency’s rules regarding compensation in connection with loans and lines of credit for credit union members. This proposed rule will follow-up on an Advanced Notice of Proposed Rulemaking (ANPRM) published by NCUA back in April 2019.
Golden Parachute and Indemnification Payments: NCUA predicted it would publish a proposed rule in June 2022 that will update Part 750 of the NCUA regulations, which contain the prohibition on certain golden parachute and indemnification payments. However, NCUA has updated the timeline and now expects to publish the proposed rule in January 2023. The agenda states these changes will improve the organization of Part 750 and would add a section on merger-related financial arrangements, among other things.
Uniform Rules of Practice and Procedure: NCUA, along with the other federal financial regulators, plans to publish a proposed rule in June 2022 to update the Uniform Rules of Practice and Procedure for proceedings before the Office of Financial Institution Adjudication. However, no such NPRM has yet been published. The current rules are found in Part 109 of the OCC regulations. The agenda states that these rules have not been updated in nearly 25 years.
Digital Assets and Related Technologies: In July 2021, NCUA published an ANPRM with a comment due date of September 2021 regarding decentralized finance and digital assets (such as cryptocurrencies) and their relation to the credit union industry. The regulatory agenda states that NCUA will reviewed the comments received and decide what proposals – if any – should be made. The estimated publication date for a proposed rule has been updated from June 2022 to December 2022.
Subordinated Debt: NCUA is considering issuing a NPRM to amend its Subordinated Debt regulation as it applies to government investors. The agenda states that the “proposed rule would address the duration of regulatory capital treatment of this instruments and may include other amendments to the Subordinated Debt regulations, including the requirements that apply to federally insured credit unions that issue Subordinated Debt.” NCUA predicts it will publish an NPRM in October 2022.
Procedures for Monitoring BSA Compliance: NCUA, along with the other federal financial regulators, plans to seek comment on a NPRM to amend its BSA Compliance Program rule consistent with the Anti Money Laundering Act of 2020. The agenda states that a NPRM can be expected in June 2022; however, no such NPRM has yet been published.
ACCESS Initiative: Chartering and Field of Membership Regulations: Per the agenda, NCUA’s Advancing Communities through Credit, Education, Stability, and Support (ACCESS) initiative is “designed to refresh and modernize regulations, policies, and programs in support of greater financial inclusion within the NCUA and the credit union system.” NCUA is considering issuing a NPRM to amend its chartering and FOM regulations, to remove outdated requirements, simplify the charter approval process, and clarify regulatory language. A NPRM is predicted to be issued in December 2022.
Computer-Security Incident Notification Requirements for Federally Insured Credit Unions: In November 2021, the federal banking agencies issued a rulemaking titled “Computer-Security Incident Notification Requirements for Banking Organizations and Their Bank Service Providers.” NCUA is reviewing the rulemaking and may issue similar requirements for federal credit unions. The agenda states that a NPRM may be published in June 2022; however, no such NPRM has yet been published.
Fintech: A NPRM is predicted to be published in November 2022 to provide opportunities for federal credit unions to have “the ability to take advantage of advanced technologies and opportunities offered by the fintech sector.”

Be sure to check out the full agenda to review the items that are in the final rule stage, including:

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