ALEXANDRIA, Va.—A vote on its “Service Facility” rule proposal is on the agenda when the NCUA board meets this week.
At the time it was proposed during its December 2020 meeting, the proposal called for allowing CUs to include any shared branch, shared ATM, or shared electronic facility in the definition of “service facility” for a multiple common-bond federal credit union that participates in a shared branching network.
At the heart of the issue is the concept of “reasonable proximity,” in which NCUA has traditionally required a credit union to have a physical facility within 25 miles of an underserved market to make it eligible for its field of membership.
The NCUA board has been divided on the issue. At the time it was proposed, then NCUA board member and now Chairman Todd Harper said, “Construing reasonable proximity to include internet access could render the Federal Credit Union Act requirement a near nullity.”
But during the NACUSO Network meeting last week, NCUA Board Member Rodney Hood said he expects the board will pass the proposal and may do so unanimously. Hood was joined by former NCUA Chairman Dennis Dollar during the discussion, with Dollar calling the concept of a 25-mile, bricks-and-mortar requirement obsolete in a digital age. Hood’s expanded comments on why he believes it’s necessary and will pass can be found here.
Also on Agenda
Other issues on the Thursday meeting agenda will include:
The meeting will be streamed live on NCUA.gov starting 10 a.m. ET.
At the time it was proposed during its December 2020 meeting, the proposal called for allowing CUs to include any shared branch, shared ATM, or shared electronic facility in the definition of “service facility” for a multiple common-bond federal credit union that participates in a shared branching network.
At the heart of the issue is the concept of “reasonable proximity,” in which NCUA has traditionally required a credit union to have a physical facility within 25 miles of an underserved market to make it eligible for its field of membership.
The NCUA board has been divided on the issue. At the time it was proposed, then NCUA board member and now Chairman Todd Harper said, “Construing reasonable proximity to include internet access could render the Federal Credit Union Act requirement a near nullity.”
But during the NACUSO Network meeting last week, NCUA Board Member Rodney Hood said he expects the board will pass the proposal and may do so unanimously. Hood was joined by former NCUA Chairman Dennis Dollar during the discussion, with Dollar calling the concept of a 25-mile, bricks-and-mortar requirement obsolete in a digital age. Hood’s expanded comments on why he believes it’s necessary and will pass can be found here.
Also on Agenda
Other issues on the Thursday meeting agenda will include:
- A briefing on modernized examination tools and the agency’s COVID-19 response
- A board briefing on the share insurance fund quarterly report
- A briefing on NCUA’s 2022-2026 Strategic Plan
The meeting will be streamed live on NCUA.gov starting 10 a.m. ET.
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