We Don't Need Regulation! Here are My Ten Reasons Why NCUA Should Not Regulate Succession Planning.
1. My Poll Results Heavily Favor Guidance 72% Neither 22% over Regulation (just 6% of the votes. The Wisdom of Crowds recommends Guidance.
2. Other banking regulators do NOT have a regulation on Succession Planning. NCUA admits this in the proposed regulation: “The proposed rule is also consistent with the guidance issued by the other banking agencies to address succession planning”
3. The proposed regulation is a solution in search of a problem, It’s flawed to think a succession planning regulation, guidance or policy will have a material impact on slowing mergers.
4. If NCUA doesn’t have an Enterprise Risk Management Regulation it doesn’t need a Succession Planning regulation.
5. Lack of a written succession plan is NOT unsafe and unsound.
6. Benefits of Succession Planning can be achieved via guidance.
7. Guidance is nimble and can be more easily changed as it can be issued by the NCUA Board Chairman and does not require a board vote to propose and finalize
8. The proposed Rule Lacks Clarity regarding key positions in a credit union’s succession plan
9. If its not required for state charters don’t require it for federal charters.
10. Studies show that flawed Succession Planning can be a demotivator. If your position is not defined as a key position or if you do not get accepted to enjoy the benefits of the succession planning program it can create morale problems at your and lower levels.
There is hope - as the proposed rule was approved by a 2-1 vote, with Rodney Hood voting against. Only one board member needs to change their vote to end this needless regulation.
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