A Direct Line Blog

From NCUA Press Release

The NCUA Board met yesterday and unanimously approved a final rule that will require federally insured credit union boards of directors to establish succession planning processes for key positions. The effective date of the final rule is January 1, 2026.

Said Chairman Harper, “We know that the failure to plan for management and key decision-maker transitions comes with a cost. The potential costs range from an unanticipated merger of a credit union or its failure when key personnel depart. For small, low-income, and minority depository institution credit unions, as well as those that support under-resourced urban and rural communities, this situation happens more than any of us would like. This final rule on succession planning establishes a way for the NCUA to address one of the most common causes of unplanned and unforced credit union mergers. It also ensures that smaller institutions remain the cornerstone of our nation’s federally insured credit union system.”

The final rule requires the board of a federally insured credit union to establish a written succession plan that addresses the specified positions that are vital to the operation and management of the credit union, and regularly review these plans to ensure they are current. The final rule also requires newly appointed members of the board to be familiar with those plans within six months post-appointment.

Smaller credit unions can develop succession plans by leveraging the succession plan template included in this rulemaking, getting assistance through the Small Credit Union and Minority Depository Institutions Support Program, and completing online training available through the NCUA’s Learning Management System.