HARRISBURG, Penn.-The Pennsylvania CU Association believes connecting small credit unions with NCUA regional supervisory teams, and the league's compliance staff, is helping small CUs better cope with regulatory and compliance issues.
Pointing out that big credit unions can dedicate staff to these areas, whereas small credit unions are often left with the CEO to address the matters, Pennsylvania CU Association SVP Mike Wishnow said leaders of credit unions have most recently been raising their concerns related to enterprise risk management.
The PCUA has been holding the meetings to connect league staff, NCUA, and leaders from Pennsylvania credit unions below $30 million in assets. "Once a year we work with NCUA to get supervisory examiners from the region, and we will pair them up with our credit union development team here and assemble a program-everything from regulatory compliance, to audit issues, to risk assessment. It's very operational in nature."
Called Small Credit Union Clinics, the latest meetings were held in western Pennsylvania with some 37 CUs in attendance. Having NCUA on hand not only provides worthwhile instruction, it also allows CEOs to speak directly with NCUA's regional office regarding issues they may be experiencing with exams. "In the last year or two as more regulations have come down, more credit unions feel that some of the examiners are pushing hard or nitpicking," said Wishnow. "This gives our CEOs a forum to provide feedback directly to the regional staff. That's often a very good way to get results."
Enterprise risk management was on the minds of many CEOs at this past meeting, noted Wishnow. "Clearly, NCUA has signaled that they are concerned that interest rate risk is at an all-time high."
Wishnow pointed out that the focus on interest rate risk from examiners is not making it easy for credit unions to generate all the loans they need in a very low-rate environment. "NCUA is telling credit unions to really shock their balance sheets, to know what can happen if rates move up. They used to say 200 to 300 basis points, now they are saying 500."
Other Issues Raised
Other issues raised at the meetings were examiners writing up credit unions for practices that used to receive warnings, examiner inconsistency, and corporate assessments."
The meetings are held a few other times each year, but without the NCUA. Wishnow said those meetings are beneficial not only to pass on education from the league, but to also allow the CEOs to network. "They can talk with their peer groups and understand all of the issues everyone is facing and get advice. They can help each other out a lot."
