WASHINGTON–NCUA has joined with other federal financial regulators in announcing their supervisory guidance does not “carry the force of law.”
The joint statement from the Federal Financial Institutions Examination Council, which besides NCUA includes the Office of the Comptroller of the Currency, Treasury (OCC); the Federal Reserve, the FDIC and the CFPB, includes a Notice of proposed rulemaking.
“By codifying the 2018 Statement, the proposed rule is intended to confirm that the agencies will continue to follow and respect the limits of administrative law in carrying out their supervisory responsibilities,” the joint statement reads. “The 2018 Statement reiterated well-established law by stating that, unlike a law or regulation, supervisory guidance does not have the force and effect of law. As such, supervisory guidance does not create binding legal obligations for the public.”
The comment period on the proposal is now open for 60 days. The full joint statement can be found here.
“This was a longshot effort when it first started in 2018,” said John McKechnie, partner at Washington-based consulting firm Total Spectrum. “Several key Hill lawmakers thought financial institutions had a valid point when they said there was examiner overreach, but let’s face it, that’s been a familiar complaint as long as there has been regulation. Today’s move will definitely change the conversations that will occur during an exam.”