Magazine article American Banker

NCUA Proposes Report on Pay for CU Executives

Magazine article American Banker

NCUA Proposes Report on Pay for CU Executives

Article excerpt

Federally chartered credit unions would be required to report the annual compensation of their senior executives to members under a proposal from the National Credit Union Administration.

The proposal tries to satisfy some of the criticism aimed at credit unions over transparency on executive pay, but would fall short of current requirements for state-chartered credit unions and publicly owned corporations that are required to make such information available to the general public.

The NCUA said it would only require executive compensation be disclosed to members, either in annual reports or on Web sites, because it is only the members that the executives are responsible to, according to NCUA board member Gigi Hyland, who chaired a task force on the issue.

The disclosure of executive compensation, long a secretive process among credit unions, was cited by the government accounting office in a study on credit unions two years ago that suggested requiring more information on executive pay to be made available.

State-chartered credit unions are currently required to disclose the compensation to top executives in Internal Revenue Service 990 tax forms that until recently were aggregated by state credit union regulators. But federal charters are exempt from that requirement.

Publicly traded corporations are required to disclose the executive compensation in annual proxy statements.

The task force also recommended making permanent the NCUA's Member Services Assessment pilot program, which collected information on how well credit unions serve their fields of membership.

The NCUA also would collect information on what products and services each credit union offers under the proposal issued last month.

The task force study was an outgrowth of congressional inquiries into how credit unions serve the underserved. …

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