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ARTICLE · 30 OCTOBER 2025

NCUA Proposes Rule To Eliminate 'Reputational Risk' From Supervision Process

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The NCUA has issued a Notice of Proposed Rulemaking to codify the elimination of reputational risk from its supervisory program, becoming the latest federal financial regulator to do so.

United StatesFinance and Banking
Scott A. Coleman
Scott A. Coleman
Ronald K. Vaske
Ronald K. Vaske
John L. Culhane, Jr.
John L. Culhane, Jr.
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The NCUA has issued a Notice of Proposed Rulemaking to codify the elimination of reputational risk from its supervisory program, becoming the latest federal financial regulator to do so.

"NCUA has determined that assessing reputation risk is subjective, ambiguous, and lacking in measurable criteria," the agency said, in announcing the action. "The proposed rule is intended to ground NCUA's supervision and examination programs in data-driven conclusions to eliminate the risk of individual perspectives driving the supervisory process."

Comments on the proposal are due by December 22.

The agency said that reputational risk has been evaluated as part of the NCUA's examination and supervision program for decades. However, the agency said it has not seen evidence that reputational risk is a primary driver of unsafe or unsound practices or that it poses a material risk to the NCUA's Share Insurance Fund.

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