NCUA Previews Additional Exam Cycle Changes

This story has been updated

During Thursday’s NCUA Board meeting, the Board received a briefing on the 2016 mid-session budget and NCUA 2017-2021 strategic plan.

In May, NCUA Board Chair Rick Metsger established the Exam Flexibility Initiative to evaluate the agency’s examination and supervision program. Through this initiative, NCUA is looking at how to improve the efficiency of the examination process while still remaining effective, and how technology can be used in the process.

Two major changes that become effective immediately are eliminating the requirements to:

  • Examine all federal credit unions annually;
  • Examine all federally insured state credit unions with assets above $250 million annually.

“This is the type of sensible change credit unions can expect from Chairman Metsger,” said NWCUA AVP of Regulatory Advocacy John Trull. “Examining credit unions based on factors such as risk profile, emerging trends, and time elapsed since the last NCUA onsite work, makes more sense than a prescriptive annual exam. The 23 month upward limit is consistent with the current requirement and gives examiners flexibility”

Trull additionally noted that the NCUA’s revised budget realizes some saving over the initial estimates but continues to grow year over year.

“The NCUA must make investments that result in budget efficiencies,” Trull said. “Doing more work offsite and improving data collection will help stabilize a budget that has grown substantially over the past decade”

The Share Insurance Fund was reported as healthy with expenses charged to the fund running about $25 million below estimated projections. The narrowing yield curve has the potential to reduce returns on investments over the midterm.

Questions about this story? Contact Eric Horvath: 503.350.2222,

Posted in Federal, NCUA, NWCUA.