Directors Taking New Financial Ed Requirements Seriously
LAS VEGAS – Many of the credit unions that sent representatives to the National Directors’ Convention – taking place here this week – were influenced in part by the new financial literacy rules that went into effect July 27.
As of that date, directors had to be ready for the financial skills requirements outlined in NCUA Rule 701.4, which requires board members at federal credit unions to have a “working familiarity with basic finance and accounting practices.” Aaron Steinberg, editor of the Safety & Soundness Report and chairman of the Directors’ Convention, on Wednesday told Credit Union Journal the availability of training sessions helped boost attendance.
The Directors’ Convention, now in its 34th year, has always had a financial literacy “boot camp” but Steinberg said a new addition for 2011 is a breakout session devoted specifically to the new NCUA regulation. “We have seen a huge spike in interest,” he said. “Probably two times to three times what we normally get for the boot camp, and we are expecting hundreds of people [today] for the new session.”
According to Steinberg, the new rule – which NCUA describes as a baseline requirement that will help directors serve their credit union ably – should lead to better quality board composition. “I like the idea the boards are taking the requirement seriously, taking the classes and hopefully coming out the other end with a better understanding. Now, they know how to better evaluate the actions of the CEOs and CFOs. I’m happy we are able to offer this education to directors and they seem happy to take advantage of it.”