Credit Union Board Modernization Act

TO:                       ALL TENNESSEE STATE CHARTERED CREDIT UNIONS

FROM:                Greg Gonzales, Commissioner  

DATE:                  September 29, 2026

SUBJECT:            Credit Union Board Modernization Act

 

 

As you may be aware, The Credit Union Board Modernization Act (CUBMA) became law as part of the 21st Century Road to Housing Act. CUBMA amends the Federal Credit Union Act to allow certain1 well-rated federally-chartered credit unions to hold a minimum of six board meetings a year instead of the previously required twelve, while further requiring at least one board meeting per fiscal quarter.

The Department confirms its long-standing support of allowing Tennessee state-chartered credit unions to have the same powers and perform the same activities as federally-chartered credit unions. As such, I intend to exercise my authority under Tenn. Code Ann. § 45-4-501(9) to allow established Tennessee state-chartered credit unions with both a CAMELS composite and management component rating of 1 or 2 the authority to take advantage of CUBMA’s reduction to the required frequency of board meetings, if it so chooses and amends its bylaws accordingly.

Each Tennessee state-chartered credit union’s Board of Directors (Board) should understand that the decision to reduce the number of board meetings is optional. If the credit union is experiencing significant growth, introducing new products or services, or addressing other strategic or operational matters, the Board may determine that continuing to hold monthly meetings is in the credit union's best interest. While a minimum of six board meetings per year, with at least one meeting held each fiscal quarter, may become permissible for certain credit unions upon the effectiveness of an appropriate bylaw amendment approved by the Department, the Board should continue to hold additional meetings as often as necessary to effectively oversee the credit union's operations.

If a credit union wishes to adopt a bylaw provision allowing for the reduction to the required frequency of board meetings in specific situations, the Commissioner hereby grants approval2 for it to adopt the following language in its entirety in the appropriate Article addressing board meeting frequency:

“The Board of Directors shall meet at least once each month, provided however that, if, as set forth in the credit union’s most recent Report of Examination issued by the Tennessee Department of Financial Institutions, the credit union’s composite CAMELS rating is 1 or 2 AND the credit union’s Management rating is 1 or 2, the Board of Directors shall instead meet not less than six times annually, with at least one meeting held during each fiscal quarter. The Board of Directors shall meet more often if necessary.”

Any conflicting references to the frequency of board meetings that are in the credit union’s existing bylaws will need to be removed.

A credit union must also ensure that the Board has adopted the amendment(s) to the bylaws as required pursuant to Tenn. Code Ann. § 45-4-1003(e)(1).

Once the Board has adopted the bylaw amendment(s) in accordance with this bulletin, it may begin using the new board meeting flexibility immediately. A credit union adopting bylaw amendment(s) in accordance with this bulletin must promptly provide the Department with a complete set of bylaws incorporating the amendment for its records. The bylaws can be sent via email to memory.little@tn.gov.

Should you have any questions, please do not hesitate to contact Assistant Commissioner Brian Williams at brian.williams@tn.gov or for information on bylaw amendments, Program Administrator Memory Little at memory.little@tn.gov.

Thank you for your partnership as a Tennessee state-chartered credit union.

 

¹ De novo credit unions are required to hold monthly board meetings for the first five years of existence. See 12 U.S.C.A. § 1761b(1).

² So long as the bylaw amendment(s) exactly match the language and requirements as set forth in this bulletin, such amendment(s) are deemed approved by the Commissioner pursuant to Tenn. Code Ann. §§ 45-4-102(b) and 1003(e)(2).

 

A downloadable/printable PDF Credit Union Board Modernization Act (Bulletin CU-26-1)