NCUA to Issue Notice of Proposed Rulemaking on Interest Rate Ceiling
The exact timing of the interest rate notice from the NCUA remains unclear.
The NCUA still plans to issue an advanced notice of proposed rulemaking soon to solicit comments on the impact the statutory interest rate ceiling has on federal credit unions and how the agency could set a floating or variable rate.
The announcement was included in the fall update to the agency’s regulatory agenda released Wednesday as part of a government-wide update on rules that may be issued soon.
The exact timing of the interest rate notice remains unclear, since the agency also included it on its Spring regulatory update.
The NCUA also said that it and the other banking regulators will issue an updated rule prohibiting incentive-based compensation agreements that encourage inappropriate risks. That rule was issued in 2016, as required by Dodd-Frank, but the agencies said they will issue an updated version.
The NCUA also said it is considering public comment on the use of alternative capital and subordinated debt and is “moving toward” issuing a proposed rule on the issue.
The regulatory agenda also said the agency plans to issue:
- A proposed rule early next year to expand the permissible lending activities for CUSOs.
- A plan to modernize the NCUA’s rules governing compensation in connection with loans to members and lines of credit to members to provide more flexibility to credit unions.
- A revised rule governing the prohibition of a federally insured credit union from making golden parachute and indemnification payments to an institution-affiliated party. The proposed rule also will include a section on merger-related financial arrangements.