Deregulation Project

Status: Comment period closes on 2.27.26

Summary

The NCUA Board seeks comment on a proposed rule to remove the segregated deposit and collateral requirements when a federally insured credit union (FICU) acts as a surety and guarantor. Removing this regulation will provide FICUs with greater flexibility to design products that meet member needs. FICUs would remain subject to the other requirements regarding surety and guaranty agreements.

Link to full proposal: https://www.federalregister.gov/public-inspection/2025-23857/suretyship-and-guaranty-segregated-deposit-and-collateral

Simplified Summary

Currently, credit unions must keep a separate deposit or collateral (like cash or property) to fully cover the risk when they guarantee a member’s obligation. These lending requirements can limit a federally insured credit unions’ flexibility in lending. The proposed rule would remove that requirement, meaning credit unions would not have to set aside funds or collateral from the member for these agreements anymore. If the rule were to be made final, credit unions would still need to:

• Limit their guarantee to a specific dollar amount and time period.
• Make sure the guarantee creates a loan that follows all normal lending rules.

This proposed change would also apply to federally insured, state-chartered credit unions. Federal credit unions would still be subject to the applicable regulations and statutes that govern lending activities and relationships.

Proposed Changes in the Rule

• Change 1: Surety and Guaranty Agreement Requirement (12 CFR 701.20(c)(3))
  • The Board proposes removing entirely the requirement that a federal credit union obtains a segregated deposit sufficient to cover its potential liability.
  • Impact on Credit Unions: Credit unions would have the flexibility to manage surety agreements without overly burdensome requirements for managing collateral.
• Change 2: Collateral on a Segregated Deposit (12 CFR 701.20(d))
  • The Board proposes removing entirely provisions that specify the collateral requirements when federally insured credit unions act as surety and guarantor in order to provide FICUs flexibility to serve member needs.
  • Impact on Credit Unions: Credit unions would be able to determine the types of collateral they would accept, market value, and method for securing an interest in the collateral that they choose to obtain.

Status: Comment period closes on 2.27.26

Summary

The NCUA Board seeks comment on a proposed rule to remove the regulations related to approval and policies on making loans to other credit unions. While this provision would no longer be codified in regulation, federal credit unions would remain subject to statutory requirements related to making loans to credit unions. Federally insured, state-chartered credit unions would remain subject to any other applicable NCUA or state law or regulation.

Link to full proposal: https://www.federalregister.gov/public-inspection/2025-23855/limits-on-loans-to-other-credit-unions

Simplified Summary

Federal law requires a federal credit union’s board of directors to approve loans to other credit unions. (See 12 U.S.C 1757(5)(c).) The current regulation goes beyond what is required by statute and is overly prescriptive, which is why the NCUA Board is proposing to remove it.

Proposed Change in the Rule

• The Board proposes to remove 12 CFR 701.25(b). NCUA would no longer require a federal credit union to have a separate policy for lending to other credit unions.
• Impact on Credit Unions: Credit unions would be able to reduce the number of lending policies they would need to manage and approve.

Status: Comment period closes on 2.9.26

Summary:

The NCUA Board (Board) is proposing to amend its regulations for corporate credit unions by removing the requirement that a corporate credit union’s asset and liability management committee (ALCO) must have at least one member who is also a member of the corporate credit union’s board of directors. The proposed rule would also remove filing and notification requirements related to a corporate credit union’s annual report and any management letter or other report issued by its independent public accountant. The intended effect is to reduce unnecessary regulatory burden and provide corporate credit unions with greater flexibility.

Link to full proposal: https://www.federalregister.gov/public-inspection/2025-22487/corporate-credit-unions

Simplified Summary: The NCUA Board proposes removing a requirement that a corporate credit union’s ALCO must have at least one member who is also a member of the corporate credit union’s board of directors. The proposed rule also removes filing and notification requirements related to a corporate credit union’s annual report and independent public accountant’s management letter or other report.

Proposed Changes in the Rule:

• Change 1: ALCO Committee Representation (12 CFR 704.8)
  • The Board now proposes to rescind the requirement for each corporate credit union’s ALCO to have at least one member who is also a member of the board of directors.
  • Impact on Credit Unions: Corporate credit union boards would have the ability to determine their ALCO membership. The change would also reduce burden on board members.
• Change 2: Filing requirements related to a corporate credit union’s annual report (12 CFR 704.15)
  • The Board proposes to:
    • Rescind the requirement to file a copy with NCUA of an annual report within 180 days after the end of the calendar year and any management letter or other report issued by its independent public accountant within 15 days after receipt by the corporate credit union.
    • Rescind the requirement for NCUA to make the annual report available for public inspection.
    • Rescind requirements related to untimely filings.
    • Remove the requirement to report on the engagement of an independent public accountant.
  • NCUA can access this information through other means. The proposed changes only remove the requirements for the corporate credit union to file the documents with NCUA but does not limit NCUA’s access to the information.
  • The change related to the independent public accountant engagement is intended to reduce burden. Corporate credit unions would still need to inform NCUA when its independent public accountant is dismissed or resigns.
  • Impact on Credit Unions: Eliminating these filing requirements will remove unnecessary and unduly burdensome requirements on corporate credit unions.

Status: Comment period closes on 2.9.26

Summary:

The NCUA Board is proposing to amend its regulations governing supervisory committee audits to eliminate unnecessary, redundant, and overly prescriptive provisions. This action will reduce regulatory burden, increase operational flexibility for credit unions, and streamline the rules by removing requirements that are outdated or duplicative of other authorities. The intended effect of this proposal is to simplify compliance for credit unions without compromising the integrity of the audit process.

Link to full proposal: https://www.federalregister.gov/public-inspection/2025-22488/supervisory-committee-audits-and-verifications

Simplified Summary: The NCUA Board proposes to amend its regulations governing supervisory committee audits. The intended effect of this proposal is to simplify compliance for credit unions without compromising the integrity of the audit process.

Proposed Changes in the Rule:

• Change 1 – Updating definition of “Internal controls.”
  • The Board is proposing to amend 12 CFR 715.2(h), which defines “Internal control” for part 715. NCUA proposes to remove the elements of the definition that are overly prescriptive and risk becoming obsolete. This change would make the definition more durable and allow federally insured credit unions (FICUs) and auditors to apply current, industry-accepted frameworks for evaluating internal controls.
• Change 2 – Verification of member accounts
  • The Board is proposing to amend 12 CFR 715.8(a), which details specific methods for the verification of member accounts. The FCU Act, at 12 U.S.C. 1761d, requires the supervisory committee to verify member accounts at least once every two years. The regulation is overly prescriptive when it requires members’ accounts to be verified against the records of the treasurer of the credit union. The Board proposes to remove the words “of the treasurer” to state more generally that members’ accounts must be verified against the credit union’s records.
• Change 3 – Auditor engagement letter
  • The Board is proposing to amend 12 CFR 715.9(b), which requires the scope of work with an outside, compensated auditor to be documented in an engagement letter contracted with the supervisory committee. The Board proposes to remove the overly prescriptive requirement that the engagement letter must be signed by both parties.
• Change 4 – Copy of Audit Reports
  • The Board is proposing to amend 12 CFR 715.10(a) by removing the sentence that requires a supervisory committee to provide NCUA with a copy of audit reports upon request. This requirement is unnecessary as NCUA has the authority to access all federally insured credit union books and records during its examination and supervision activities.
• Change 5 – Objectives of a Financial Audit
  • The Board proposes to remove two sentences from 12 CFR 715.12(b) that describe the objective of a financial statement audit compelled by NCUA.
  • This language is unnecessary. The provision already requires an audit be performed in accordance with Generally Accepted Auditing Standards (GAAS), and GAAS already establishes the objectives of a financial statement audit.
  • The adverse opinion or disclaimer of opinion commentary in the regulation is best read as guidance and could cause confusion if auditing standards evolve to provide different objectives or expectations for financial statement audits.

Status: Comment period closes on 2.27.26

Summary

The NCUA Board is issuing this proposed rule to streamline its regulations governing advertising and the notice of insured status. This proposed rule would eliminate provisions concerning the official advertising statement. This action is undertaken to reduce regulatory complexity, and the intended effect is to reduce the administrative burden and costs for federally insured credit unions (FICUs) and provide them with greater flexibility in their advertising activities. The proposed rule would not amend requirements related to displaying the official sign.

Link to full proposal: https://www.federalregister.gov/public-inspection/2025-23854/accuracy-of-advertising-and-notice-of-insured-status

Simplified Summary

The Board is proposing changes to regulations related to how federally insured credit unions provide key information to members and potential members. Credit union advertising must be truthful, accurate, and clear about the NCUA insurance status associated with member accounts. The Board is proposing to remove overly burdensome requirements that are obsolete in relation to the modern advertising landscape. The proposed changes would simplify the regulation by removing the requirement to include the official advertising statement, while leaving in place requirements that FICU advertising be accurate and truthful.

Proposed Changes to the Rules

• Change 1: Remove Requirements for the Official Advertising Statement (12 CFR 740.5)
  • The Board proposes to remove the requirements for a credit union to include an official NCUA advertising statement in their advertising and marketing materials. The requirements are highly prescriptive, inflexible, and not well suited to modern advertising.
  • Impact on Credit Unions: Removing this provision would mean credit unions would have fewer rules to comply with when advertising, marketing, and developing incidental promotional items.
• Change 2: Accuracy of Advertising (12 CFR 740.0)
  • The Board proposes amending the scope of the regulation such that FICUs would no longer have to display a specific official advertising statement when advertising.
  • Impact on Credit Unions: Alongside the proposed change to 12 CFR 740.5, this proposed change would reduce confusion about which rules apply to credit union advertising.

Status: Comment period closes on 2.9.26

Summary:

The NCUA Board (Board) is proposing to remove Appendix A to part 748, guidelines for safeguarding member information, from the Code of Federal Regulations (12 CFR Part 748 Appendix A). Appendix A was issued to satisfy NCUA’s statutory obligation to establish appropriate standards for federally insured credit unions (FICUs) to protect the security and confidentiality of customer records and information and to protect against unauthorized access to or use of such records. The Board now believes that the placement of Appendix A in the CFR may be confusing because Appendix A is not a regulation but rather a set of guidelines intended to assist FICUs with their statutory compliance obligations. The Board proposes to remove Appendix A from the CFR and publish its contents as a Letter to Credit Unions, which enables more efficient revisions, streamlines NCUA’s regulations, and ensures guidance is conveyed as guidance.

Link to full proposal: https://www.federalregister.gov/public-inspection/2025-22488/supervisory-committee-audits-and-verifications

Simplified Summary: The NCUA Board proposes removing guidelines for safeguarding member information from 12CFR 748, Appendix A because it may be confusing to have guidance presented through regulation. These guidelines are intended to assist FICUs with their statutory compliance obligations—they are not independently enforceable. The Board will remove Appendix A from the CFR and publish its contents online.

Change in the Rule:

• Change: Remove guidance from regulations
  • The Board intends to remove the content of Appendix A from the Code of Federal Regulations. The guidelines provided by Appendix A related to Safeguarding Member Information are guidance, and the content will be published online later should the rule be finalized. This option will be a better vehicle for conveying and updating this information and will help to streamline NCUA’s regulations.

Status: Comment period closes on 2.9.26

Summary:

The NCUA Board (Board) is proposing to remove Appendix B to part 748, Guidance on Response Programs for Unauthorized Access to Member Information and Member Notice. Appendix B was issued in June 2005. Its purpose was to provide federally insured credit unions (FICUs) with guidance for creating programs to address and respond to instances of unauthorized access to member information. The Board now believes that the placement of Appendix B in the Code of Federal Regulations (CFR) may be confusing because Appendix B itself is guidance to assist FICUs in developing the response programs required pursuant to regulation. The Board instead would publish the content of Appendix B as guidance. This will be a better vehicle for conveying and updating this information and will help to streamline NCUA’s regulations.

Link to full proposal: https://www.federalregister.gov/public-inspection/2025-22490/guidance-response-programs-for-unauthorized-access-to-member-information-and-member-notice

Simplified Summary: The NCUA Board proposes 12 CFR 748 Appendix B be removed from the regulation and published as guidance to assist FICUs.

Change in the Rule:

• Change: Remove guidance from rule
  • The Board intends to publish the content of Appendix B as guidance. This will be a better vehicle for conveying and updating this information and will help to streamline NCUA’s regulations.

Status: Comment period closes on 2.27.26

Summary

The NCUA Board is publishing this proposed rule to amend the requirements for federally insured credit unions (FICUs) to report catastrophic acts to the agency. By providing more time for FICUs to notify the agency of the occurrence of a catastrophic act and by eliminating the specific list of items to be documented, the Board expects the proposed rule to reduce the compliance burden and allow FICUs to focus their resources on recovery and core functions without compromising safety and soundness.

Link to full proposal: https://www.federalregister.gov/public-inspection/2025-23856/catastrophic-act-reporting

Simplified Summary

When a catastrophic act impacts a federally insured credit union, NCUA must be notified. Under NCUA’s catastrophic act report regulation (12 CFR 748.1(b)), credit unions have five business days after the event to report to their regional director. The proposed revision requires credit unions to report directly to NCUA within 15 calendar days of a catastrophic event, allowing credit unions to manage the immediate aftermath while ensuring timely notification. Documentation of a catastrophic event remains mandatory; however, specifics of what that documentation should entail would be at the discretion of the credit union.

Proposed Changes to Rule:

• Change 1: Recipient of Report
  • The Board proposes requiring credit unions to report to the NCUA rather than to a regional director.
  • Impact on Credit Unions: This change would modernize the reporting process and provide greater operational flexibility for FICUs. This may help smaller credit unions, which may be operating under emergency conditions.
• Change 2: Reporting Window
  • The Board proposes allowing credit unions to have 15 calendar days to report a catastrophic act, an increase from the current requirement of 5 business days.
  • Impact on Credit Unions: This proposed change would provide credit unions experiencing a catastrophic act additional time to stabilize operations and assess the full scope of damage. Calendar days are also easier to calculate when determining compliance.
• Change 3: Facts to be Reported
  • The Board proposes requiring credit unions to report the basic facts of the event rather than requiring the credit union to report specific types of information. The proposal would also make the regulation clearer by revising wording that makes this requirement sound like guidance.
  • Impact on Credit Unions: This change would provide FICUs with the ability to reduce undue regulatory burden while still maintaining a record of events.