CUNA Regulatory Comment Call

April 1, 2009

EXECUTIVE SUMMARY

• The National Credit Union Administration (NCUA) has issued a proposed rule to require federally-insured credit unions (FICUs) to submit reports and other important information to NCUA through a new web-based system.
• The proposal would amend the existing regulations on reporting procedures and record retention requirements.
• Additionally, the proposal would require FICUs to report changes in senior officials resulting from election or appointment and would clarify the requirements on when credit unions must file reports with NCUA online.
• NCUA plans to implement the new system during the third quarter of this year for natural person credit unions, and sometime next year for corporate credit unions.
• Comments are due to NCUA by May 26, 2009; please submit your comments to CUNA by May 15, 2009.

Please feel free to e-mail your responses to Senior Vice President and Deputy General Counsel Mary Dunn at mdunn@cuna.com and to Regulatory Research Counsel Luke Martone at lmartone@cuna.com. You may also contact us at 800-356-9655, ext. 6743, if you have questions. Click here to access the proposed rule.

BACKGROUND

The Federal Credit Union Act grants NCUA broad authority to establish the reporting requirements of FICUs; which NCUA has prescribed in its regulations. Currently, NCUA provides software to all FICUs to assist them in preparing their Call Reports, as well as a way for them to submit their Report of Officials. FICUs currently have several options for submitting these reports, they may:

• Send them electronically using NCUA’s software;
• E-mail them;
• Save them to CD and send to NCUA; or
• Send them as hardcopies.

NCUA has decided to modernize the reporting process in order to increase efficiency, enhance accuracy of data, and to provide a secure, single access portal for FICUs to submit, edit, and view data NCUA collects.

BRIEF DESCRIPTION OF THE PROPOSED RULE

The proposed rule would establish a centralized, web-based system for the submission and management of reports FICUs are required to file. Therefore, NCUA will no longer issue software for submitting the data; the online system will permit FICUs to submit data to NCUA from any computer.

In order to use the new system, credit unions would simply need a computer, Internet access, Internet Explorer, and an e-mail address; the approximately 150 small credit unions without Internet access would be permitted to submit paper Call Reports. Each FICU user would establish a unique login and password, and would only have access to its own confidential information. Non-confidential information would continue to be available to the public.

NCUA plans to implement the new system during the third quarter of 2009 for natural person credit unions; which will still be required to submit Call Reports quarterly. The system will be implemented for corporate credit unions in 2010; which will continue to file monthly Call Reports.

Specific Changes

In regard to reporting procedures and record retention requirements, the proposed rule would amend sections 741.6 and 748.1, and Appendix A to part 749. Section 741.6 would clarify when FICUs must update their Credit Union Profiles. The proposed rule would amend section 748.1 to clarify the compliance report filing requirements for FICUs using the online system and for those who file manually. FICUs that cannot certify compliance online would do so in writing on the new Credit Union Profile form. Lastly, the proposed rule would update the record retention guidelines in Appendix A of Part 749 and include the new Credit Union Profile form as a key operational record that should be retained permanently.

The proposed rule would require FICUs to update the Credit Union Profile within 10 days of the election or appointment of senior management or volunteer officials, or within 30 days of any change of information in the profile.

Lastly, the proposal would not change the requirement that FICUs certify compliance with Part 748; which requires the president or other managing official of a FICU to sign and date the compliance statement in the Report of Officials.

1. Are there any specific reasons why a credit union would be unable to comply with this new system?
   
   

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2. NCUA has indicated that the requirements of this proposed rule are expected to lessen the reporting burden. Do you agree? Could they increase the burden?
   
   

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3. Do you foresee any increased compliance costs associated with NCUA’s proposed system?
   
   

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4. Any other questions or concerns?
   
   

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Copyright © 2009 - Credit Union National Association, Inc.