New rule could force federal credit unions to divulge CEO salaries

The White House Office of Management and Budget said a rule requiring federal credit unions to report executive compensation could soon be on the NCUA board’s agenda.

The National Credit Union Administration is considering issuing a proposed rule that would require federal credit unions to provide information on executive compensation to their members.

The rule would require information similar to what state-chartered credit unions already provide, according to the White House Office of Management and Budget’s recently released spring regulatory agenda.

The agenda provides an overview of possible regulatory actions by federal agencies in coming months.

The NCUA has not yet posted the agenda for its July 18 board meeting.

John Buckley Jr., president and CEO of Gerber Federal Credit Union in Fremont, Michigan, told Tyfone he does not particularly like the proposal because “members have no frame of reference for what executive compensation should be.”

Buckley has been at the helm of the $230 million-asset credit union for nearly 18 years.

But the American Bankers Association in a post on its website said it has strongly advocated for credit union accountability and transparency. The ABA believes that such reporting on executive compensation “could help provide critical data on credit union activities to consumers and communities alike.”

Likewise, the CEO of a $400 million-asset credit union headquartered in the West, who requested anonymity, said he is in favor of the proposal.

“Being a state-charter we’ve been doing it for years with no issues,” he said. “Being a member-owned institution, transparency is appropriate.”

Aside from federal credit unions and religious organizations, tax-exempt organizations are required to disclose certain financial information through IRS Form 990.

On the bank side, an American Banker report earlier this year showed that JPMorgan Chase’s CEO Jamie Dimon received $36 million in total compensation last year while Wells Fargo’s CEO Charlie Scharf was paid $29 million.

“Members have no frame of reference for what executive compensation should be.”

 – John Buckley Jr.
Gerber FCU

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