Federal Register - Credit Unions Proposals Texas Relevant

Compensation in Connection With Loans to Members and Lines of Credit to Members

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Summary

- The NCUA Board is proposing changes to regulations that limit compensation for credit union employees related to loans and lines of credit. - The proposed rule would allow incentive and bonus compensation based on lending metrics tied to the credit union's overall financial performance.

Why It Matters for Texas Credit Unions

The proposal directly affects Texas credit unions as it pertains to compensation practices for employees involved in lending activities.

Original Source Material

The NCUA Board (Board) is issuing for public comment a proposal to amend the NCUA's regulation that limits a federally insured credit union (FICU) official and employee compensation in connection with loans to members and lines of credit to members. These regulations have generated confusion and are unduly restrictive. To provide clearer and more flexible standards, the proposed rule would expressly permit incentive and bonuses to employees, including senior management, to incorporate lending metrics as part of compensation based on a credit union's overall financial performance.