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Succession Planning: It's Not Optional - Master the New NCUA Succession Planning Rule
New NCUA Succession Planning Ruling
The National Credit Union Administration (NCUA) unanimously approved a final rule on succession planning, requiring all federally-insured credit unions to have written succession plans for key positions by January 1, 2026. The reason for this ruling is the high number of mergers currently happening in the credit union space. Chair of the NCUA board, Todd Harper said, “We know that the failure to plan for management and key decision-maker transitions comes with a cost… This final rule on succession planning establishes a way for the NCUA to address one of the most common causes for unplanned and unforced credit union mergers.” Also, with the silver tsunami currently sweeping through the population, many people in key management positions and on the board of directors will be retiring within the next few years. Having a succession plan to address this turnover will be necessary for every credit union’s success.
What is Required in the Ruling?
The ruling requires that all federally-insured credit unions have written succession plans in place by January 1, 2026. These plans must be created for all key positions, which includes the following:
- Members of the Board of Directors.
- Management officials and assistant management officials.
- Any other personnel that the board deems critical given the credit union’s size, complexity and risk of operations. (This can include new positions that may be required due to planned changes in operations, supervisory landscape, or corporate structure.)
- The title for each covered position.
- The expiration of the incumbents term (if they are serving is a term-limited capacity) or their anticipated vacancy date (for example, the incumbent’s expected retirement date).
- The credit union’s plan for permanently filling vacancies for each of the covered positions.
- The credit union’s strategy for recruiting candidates with the potential to assume the position.
- An estimate of the budgetary impacts of executing the succession plan. (An exact figure is not required.)
- Approve the written succession plans that meet the requirements above.
- Review, and update as necessary, the succession plan in accordance with a schedule decided on by the board of directors but no less than every 24 months.
Create Effective and Compliant Succession Plans Without the Complexity!
SUCCESSIONapp® is the leading provider in board and management succession planning solutions trusted for over 13 years! Our easy-to-use software takes the stress out of succession planning by providing a structured, intuitive workflow that ensures smooth and successful transitions. Our global award-winning software guides you step by step, eliminating any guesswork and complexity. Easily create NCUA compliant succession plans with SUCCESSIONapp® and take control of your organization’s future today! Explore our board and management succession planning modules below!
Board Succession Plans
Develop a Board Succession Plan that enables you to…
- Have a board that embodies all your critical competencies.
- Always have qualified candidates available for service on the board.
- Have seamless transitions when director openings occur.
- Identify your future board leaders.
- Accessibility to your plan on a secure site at any time, on any device.
Management Succession Plans
Easily create Management Succession Plans that ensure…
- You have bench strength in the event of a sudden or planned departure.
- Leaders are motivated to stay by providing planned development opportunities.
- Leaders have critical leadership capabilities and are ready when turnover occurs.
- You get a complete picture of your organization’s bench strength/gaps.
- Accessibility to your plan on a secure site at any time, on any device.
