Creating Influence

Credit Union Charter Enhancements Under Way in Georgia

Earlier in May Governor Nathan Deal signed into law H.B. 780 by Rep. Bruce Williamson (R-Monroe), which brings about multiple positive regulatory reform provisions for credit unions. And while this is positive, it’s even stronger to see that the Department of Banking and Finance quickly issued proposed rules in conjunction with this new law on May 17th to help bring these positive changes into effect. These positive changes for the industry and represents almost a year’s worth of work by the Department of Banking and Finance (DBF) and others, including the credit union charter review task force that met back in July 2017 and 2016. This task force was created specifically to generate ideas for potential improvements to credit union law, and the multiple credit union charter enhancements:

  • Expanding the section of law that protects the use of the words “credit union” to also include the name of a subsidiary of the credit union,
  • Creating a process in law for state-chartered credit unions to utilize a federal power offered by the Federal Credit Union Act or NCUA that is presently in effect,
  • Strengthening the liability language of directors to ensure that the director oath does not modify the standard of care or legal duties, or create a loophole where directors could be sued under a different standard,
  • Outlining in law the ability to protect the ability of credit unions to hold, purchase or fund life insurance plans on any of the directors, officers, employees or others deemed as such that their death would cause a financial loss to the credit union,
  • Placing protections in law for credit union director emeritus positions to ensure that they are not subject to liability standards for directors, and outlining in law the ability to create these roles, and
  • Removing regulatory burdens for credit unions by eliminating the current requirement in law that all loans to employees of the credit union must be reported to the board of directors (the requirement would still hold for officers, directors, and committee members).

Also, the DBF utilized the rulemaking process to bring about much-needed changes for credit unions, including eliminating the need to conduct a full member verification audit annually, as well as eliminate many of the burdensome record retention requirements. All of the time, energy, work and effort by the DBF, credit unions and GCUA bring these improvements to help enhance operations, alleviate compliance burdens, and modernize the laws surrounding credit unions.

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