NCUA outlines 2020 priorities

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The National Credit Union Administration’s 2020 priorities bear a strong resemblance to last year: a focus on cybersecurity, credit risk, consumer protection and anti-money laundering compliance.

The agency outlined those issues in a letter to credit unions released Tuesday, noting the regulator plans to hone in on cybersecurity education by increasing its outreach to promote cyber awareness in the year ahead. NCUA Chairman Rodney Hood wrote in the letter that the agency hopes to equip credit unions with the necessary resources and knowledge to protect against cyberattacks while continuing to solicit feedback from the industry about the challenges credit unions face in that arena.

As reported, some analysts have warned that U.S. financial institutions could be at increased risk of cyberattacks from Iran in retaliation for the government's assassination of Iranian military leader Qassem Soleimani.

Cybersecurity maturity assessments, which NCUA launched in 2018 for credit unions with $1 billion or more in assets, will also continue to roll out throughout 2020. In the coming year NCUA will focus on CUs with assets of $250 million and above before scaling down to those with at least $100 million in assets. An updated version of the agency’s automated cybersecurity examination tool – a collaboration between NCUA, the Department of Homeland Security and the Idaho National Laboratory – will be deployed in early 2020 as well.

NCUA also will put an emphasis on underwriting standards in the year ahead, with examiners looking to verify that credit unions have conducted proper due diligence in analyzing borrowers’ ability-to-repay requirements. These changes follow a year in which the agency faced high-profile scrutiny over the taxi medallion lending scandal and concerns from some board members that concentration risk is not receiving adequate scrutiny.

“In 2020, the NCUA is implementing enhanced examination procedures, including supervisor concurrence and additional quality controls, for credit unions with very high concentrations in specific loan types,” NCUA Chairman Rodney Hood wrote in the letter.

Also on NCUA’s radar is Bank Secrecy Act and AML compliance, areas in which some credit unions were previously penalized for failing to file proper paperwork.

The agency has also promised “additional guidance…soon” for credit unions serving hemp-related businesses, and in the year ahead examiners will collect data on the services CUs offer to those shops.

“I look forward to continuing to advance how the agency regulates and supervises credit unions, adopting innovations and incorporating efficiencies while ensuring a safe and sound credit union system,” Hood concluded in his letter.

NCUA also recently announced its 2020 operating fee, with an expected increase of 1.13% for credit unions with assets of $1 million or more. Last year’s operating fee increased by an average of 2%. The increase for 2020 is the result of the overhead transfer rate and changes in the regulator’s capital investment program, the agency wrote in a separate letter to credit unions.

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Compliance AML NCUA Cyber security Law and regulation