Be sure to check all the right boxes while also tying your efforts to your strategy.
By Jennie Boden and Chris Jones, ChFC®, CLU®
Also read, “The Opportunity for CUs in NCUA’s New Succession Planning Rule.”
2026 is already offering credit unions opportunities to strengthen their organizations to better serve their members.
Case in point: The National Credit Union Administration’s final succession planning rule (12 CFR Parts 701 and 741, RIN 3133-AF42) went into effect on Jan. 1, 2026. The rule requires both federal credit unions and federally insured, state-chartered credit unions to establish written succession plans.
This article describes the key things you’ll need to know to comply with the letter of the new rule. Our article, “The Opportunity for CUs in NCUA’s New Succession Planning Rule,” offers important thoughts about the strategic opportunity available to credit unions that choose not to just check a box, but to be strategic about their compliance efforts.
What the New Succession Planning Rule Says
NCUA’s newly effective succession planning rule requires federal and federally insured, state-chartered credit unions to establish a board-approved, written succession plan consistent with their size, complexity, and risk of operations. Credit unions can leverage this NCUA video series for further clarification on what is required.
The agency has also provided a succession planning template for smaller credit unions that we find too limited to be of much strategic value. We offer suggestions in the next section for how to deliver a right-sized plan that stays strategic.
Credit unions with less than $100 million in assets and minority depository institutions of all sizes may also be eligible for assistance in a variety of areas, including succession planning, through NCUA’s Small Credit Union and Minority Depository Institution Support Program.
The rule sets forth that these credit union jobs, or their equivalents, must be included in the written succession plan, at a minimum:
- Members of the board of directors
- “Management officials” and “assistant management officials,” as those terms are defined in Appendix A of the rule, if provided for in the federal credit union’s bylaws, and, to the extent not already covered, the senior executive officers identified in § 701.14(b)(2)
- Any other personnel the board of directors deems critical given the federal credit union’s size, complexity, or risk of operations. This includes new positions that may be required due to planned changes in operations, supervisory landscape, or corporate structure.
As a best practice, we also recommend that CUs include the members of their audit and supervisory committees in succession planning. The rule requires each credit union’s succession plan to include the following information:
- The title for each covered position and the date the incumbent’s term expires (if serving in a term-limited capacity), or other anticipated vacancy date, if known (such as the incumbent’s retirement eligibility date or announced departure date).
- The credit union’s plan for permanently filling vacancies for each of the positions.
- The strategy for recruiting candidates with the potential to assume each of the positions, including how the selection and diversity of skills among the employees covered by the succession plan, collectively and individually, promotes the safe and sound operation of the credit union.
The rule also requires that boards of directors review the succession plan every two years and that new board members review and become knowledgeable about the plan within six months of becoming a director.
In the event circumstances require a substantial deviation from the board-approved plan, management and/or the board have the flexibility under the new rule to do what they deem necessary at the time, consistent with their fiduciary duties and legal responsibilities. While this action doesn’t have to be documented in the board’s meeting minutes, it should be reported to the board as soon as possible.
Don’t Forget to Be Strategic
We put together this short guide to the rule to help you with basic compliance with
NCUA’s new succession planning rule. However, we also urge you to take advantage of the strategic opportunity available to you as you comply with NCUA’s new succession planning rule: 1) Link your succession plan to your strategic plan and 2) boost your retention with thoughtful compensation and appropriate SERPs that make your credit union a place where top talent wants to work. For more guidance on how to do this, read our article, “The Opportunity for CUs in NCUA’s New Succession Planning Rule.”
Disclosure: The authors’ firm provides strategy and compensation advisory services; links are provided for informational purposes. Any executive compensation or benefit arrangements should be evaluated for legal, tax, accounting, and safety-and-soundness considerations.
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About the Author
Chris J. Jones, CLU®, ChFC®
Partner & Senior Benefits Consultant
Known for his analytical mindset and mathematical precision, Chris works closely with credit unions to design Supplemental Executive Retirement Plans (SERPs) that are not only durable and compliant but also grounded in data that supports long-term performance. With more than three decades in financial services, he has built a reputation for ensuring that every plan rests on solid numbers and delivers on its promise to executives and boards.
Since 2014, Chris and his team have implemented more than 200 split-dollar SERPs for credit unions and nonprofits, each one on track or exceeding its original performance projections.
