Credit Union Exam Solutions Presents With Flying Colors When DORs become LUAs: What you Need to Know About Letters of Understanding & NCUA
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Jun 24, 2024 Experts Steve Farrar and Todd Miller discuss the rise in Letters of Understanding in credit unions. They cover the significance, implications of non-compliance, negotiation strategies, and the importance of clear communication between board and management.
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Request Sufficient Time for LUA Review
- Credit unions should request reasonable time to review and understand an LUA before signing.
- They should also discuss the LUA with their board to ensure everyone understands the implications.
Board Responsibility for LUAs
- Even board members who vote against an LUA are subject to its terms if the board approves it.
- This shared responsibility highlights the importance of board governance discussions.
Refusal to Sign Does Not Absolve Responsibility
- Board members refusing to sign an LUA, even if the majority approves, does not shield them from responsibility.
- They remain accountable as part of the board.