In response to the national declaration disaster and the impact that the coronavirus is having on credit unions, NCUA issued a letter last week indicating that federal credit unions may adopt by a two-thirds vote of its board of directors a bylaw amendment to Article IV without seeking further bylaw approval from NCUA.
The “emergency exception to in-person quorum requirement” allows for a credit union to hold its annual meeting of the members and special member meetings for authorized purposes other than member expulsion under Article XIV of these bylaws, virtually and without an in-person quorum if all of the following conditions apply and are certified in meeting minutes by a resolution of the majority of a quorum of the board of directors:
- at least one of the following is located in an area where a federal, state or local authority has declared a state of emergency or major disaster — all or part of a community the credit union serves, or the credit union’s headquarters;
- the credit union has the technological capacity to facilitate virtual meeting attendance, voting and participation;
- members receive at least seven days’ advance notice of the change to a virtual meeting format and appropriate instructions for how to join, participate and vote during the virtual meeting; and
- NCUA has issued general or specific guidance notifying the credit union that it is appropriate to invoke this bylaw provision.
“With respect to President Trump’s proclamation of a national emergency in relation to the COVID-19 outbreak, the NCUA hereby notifies all FCUs that, if they have adopted this bylaw amendment, it is appropriate to invoke its provisions at any point during the year 2020 for meetings occurring in 2020, if a majority of the board of directors so resolves for each such meeting,” the letter stated.
The letter also stated that a federal credit union has flexibility to postpone its annual meeting. “While there is no law or regulation that prohibits a FCU from postponing its annual meeting, it should provide notice of the rescheduled meeting as required in the FCU Bylaws.”
The letter can be accessed on NCUA’s website.