BROOKFIELD, Wis.-Orlando Hanselman is offering this To Do List for complying with NCUA's new rules on interest rate risk:
- Time is of the essence. Gain an understanding of what the reg says and implies, and what best practice interest rate risk management looks like today.
- Comparisons needed. Compare what the reg says with a true assessment of what the CU is presently doing and determine the "gap."
- Outsourcing Issues. Those who outsource may likely find themselves considering bringing ALM management in-house, due to the need for greater control and sophistication under the letter. "Credit unions may find that outsourcing is too generic to meet the requirements," and that customized outsourced programs are too expensive due to a la carte pricing.
- Use of reporting. Management teams, and especially boards, will have to raise the level of knowledge in how to interpret ALM reports and be able to use the results of these reports strategically.
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