Changing Lanes: Bylaw Amendments

You ever heard someone say, “change is good,” when your life is falling apart? With the exception of a young attorney changing lanes, crashing into a desperate man trying to win back his family, and leaving the scene of an accident without his important case file, change can be good.

Sometimes, federal credit unions find that their original bylaws just don’t work for them anymore. With an ever-changing society, federal credit union bylaws may appear antiquated and won’t help serve the membership they have versus the membership they used to have. Having the right bylaws could enhance your reputation within the community. Believe me when I tell you, the souring of member attitudes towards the credit union is bad for business and your computers.

How does one credit union go about changing an outdated bylaw? Generally, NCUA permits bylaw changes in one of two ways: fill-in-the-blank amendments and non-fill in the blank amendments. Some amendments only require board approval, while other amendments require NCUA approval.

There are model bylaws which permit federal credit unions to select an option or range of options or fill-in-the-blank, changing to a different permissible option requires only a two-thirds vote of the FCU’s board of directors. For instance, the election style provision is an example of fill-in-the-blank. A federal credit union can choose one of four election types for its preferred way of conducting official elections. Once a selection is made, the change is effective upon board approval. Adopting new provisions of the model bylaws can also be accomplished with board approval if the provision is being adopted verbatim, or as they are written within the model bylaws.

Any other change not listed above likely requires NCUA approval. A request to amend the bylaws must be submitted to the Office of Credit Union Resources and Expansion (CURE) at The process for a request to amend bylaws are outlined in Appendix A of part 701:

“The procedure for approval of a bylaw amendment is as follows:

a. The FCU must submit its request to the Office of Credit Union Resources and Expansion (CURE).

b. The request must include:

1. The section of the FCU Bylaws to be amended;

2. The reason for, or purpose of, the amendment;

3. An explanation of why the amendment is desirable and what it will accomplish for the federal credit union; and

4. The specific wording of the proposed amendment.

c. CURE will advise the credit union within 60 days if it approved the proposed amendment after its review and, if necessary, consultation with the NCUA’s Office of General Counsel. If CURE does not reach a decision within 60 days, the proposed amendment is considered to be denied unless CURE requests an extension of time from the federal credit union and the credit union agrees to such a request. If CURE reaches an adverse decision or CURE fails to render a decision within the agreed timeframe, the credit union may appeal that decision in accordance with the procedures set out in subpart B to part 746 of this chapter. If CURE fails to render a timely decision, within thirty days it must provide the FCU with a written notice of its failure to render a timely decision and a statement of any concerns that CURE has with the bylaw amendment request.”

Local counsel may be able to help the credit unions change their bylaws, by sending in a request pursuant to NCUA procedure. Credit unions may also find opinion letters about bylaw amendments helpful. Feel free to send questions to America’s Credit Union’s Compliance team, as well!

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