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A special message from Mary Martha Fortney, President and CEO,
May 20, 2008
 As the association of state credit union regulators, NASCUS is focused on maintaining state authority and state regulation of state-chartered credit unions.
Recently, the National Credit Union Administration (NCUA) issued an Advanced Notice of Proposed Rulemaking (ANPR) concerning conversions and mergers (Parts 708a and 708b) of federally insured credit unions. NASCUS studied the proposal closely and has expressed serious concern about the ANPR’s impact on state regulatory authority and state law. NASCUS concludes that the ANPR intrudes on longstanding corporate governance law and could negatively impact dual chartering.
In comment letters to NCUA, NASCUS explains that state-chartered credit unions, as state corporations, follow state law and regulation as their primary sources of credit union powers, governance and membership. Therefore, NASCUS discerns no safety and soundness issue or statutory authority that would justify NCUA’s preemption of state law and the ANPR’s extension to state-chartered, federally insured credit unions (FISCUs).
In addition to the NASCUS comment letter, 30 state agencies co-signed a letter to NCUA expressing their serious concern about the ANPR. NASCUS and state regulators believe that if the agency moves ahead with a formal proposal, NCUA will overstep its statutory authority by preempting the longstanding precedent that state law dictates corporate governance. Several state agencies submitted separate comment letters to the NCUA on behalf of their individual agencies.
NASCUS emphasizes that NCUA’s statutory authority must be read narrowly in the context of the role of state regulators and the dual chartering system. NASCUS discussed its comments with NCUA and will continue to advocate for the preservation of state authority in conversions and merger processes.
To view NASCUS comment letters, follow this link. If you have any dialogue to share with NASCUS on this topic, I can be reached at (703) 528-8688 or by email at marymartha@nascus.org.
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