Markets Wired

ALEXANDRIA, Va. (May 18, 2016) – Credit union system stakeholders will have an opportunity to hear National Credit Union Administration Board Members discussing issues prior to taking action under a new procedural direction announced today by NCUA Board Chairman Rick Metsger.

“Due to federal sunshine laws, and the fact that NCUA has never had more than three Board members, we cannot deliberate on policy issues, except at open meetings,” Metsger said. “What we’re doing is giving Board Members an opportunity to talk directly to one another, exchange thoughts and ideas. It also provides the broader credit union community with insight into our thought process. Since no action is being taken, stakeholders will also have the opportunity to consider our discussion and provide early input before any rulemaking begins.”

The first briefing is scheduled for the May 19 open Board meeting and will cover agency plans to modernize the Call Report and Profile and the system for reporting and storing credit unions’ information. Metsger said that, in the future, when time allows, NCUA Board meetings will include briefings in order to give Board Members a chance to talk about evolving issues.

“If these initial briefings and discussion are valuable because they provide stakeholders with better visibility into the workings of the agency, I’d like to expand the practice,” Metsger said. “When a Board agenda is light enough that it gives us the luxury of time for thoughtful analysis and discussion while providing greater visibility to the regulated community on what we’re contemplating, I want to take advantage of that opportunity.”

Board Action Bulletin

NCUA to Request Comments on Modernizing Call Reports, Credit Union Profile

ALEXANDRIA, Va. (May 19, 2016) – The National Credit Union Administration Board held its fifth open meeting of 2016 at the agency’s headquarters here today and discussed two issues:

• The Chief Financial Officer briefed the Board on the performance of the Temporary Corporate Credit Union Stabilization Fund, including plans to pay down $700 million of borrowings from the U.S. Treasury by May 31, 2016.
• The Office of Examination and Insurance informed the Board about proposed plans to modernize the Call Report and Credit Union Profile content and improve data collection.

Stabilization Fund Payment to Reduce Treasury Borrowing to $1 Billion

By the end of May, NCUA plans to make a $700 million payment to the U.S. Treasury against prior borrowings by the Stabilization Fund.

When that payment is made, the Stabilization Fund’s outstanding borrowings from the U.S. Treasury will decrease to $1 billion. The payment largely comes from the net proceeds from approximately $700 million in recent NCUA legal recoveries from Goldman Sachs, UBS and Credit Suisse, some of which came in after the close of the first quarter.

“NCUA’s corporate resolution plan remains on the right track, thanks to an improving economy, strong legacy asset performance and the continued hard work of the NCUA staff in successfully pursuing legal recoveries and ably managing the Stabilization Fund,” NCUA Board Chairman Rick Metsger said. “NCUA is committed to staying on this prudent course to achieve the Stabilization Fund’s ultimate lowest-cost resolution.”

For the quarter ending March 31, 2016, the Stabilization Fund’s net position increased by $78.2 million to a positive $618.6 million, up from $540.4 million at the end of the previous quarter, based on the best available preliminary and unaudited information.

While the Stabilization Fund continued to have a positive net position in the first quarter, no funds are available to provide federally insured credit unions with an immediate rebate. NCUA must first repay all outstanding borrowings from the U.S. Treasury and satisfy any outstanding NCUA Guaranteed Notes obligations. Future changes in the economy or the performance of the legacy assets, which secure the NCUA Guaranteed Notes, could change the value of the assets NCUA and the Stabilization Fund can eventually access at the end of the NCUA Guaranteed Notes Program.

The change in net position primarily resulted from guarantee fees earned and improvements in projected cash flows relating to the legacy assets that secure the NCUA Guaranteed Notes.

Created by Congress in 2009, the Stabilization Fund assumed the losses associated with the failure of five large corporate credit unions and allowed the credit union system to absorb these losses over time. By law, the Stabilization Fund is scheduled to expire in 2021.

Agency to Seek Stakeholder Views on Updating Call Report and Profile

NCUA plans to consult with credit union system stakeholders as the agency conducts a comprehensive review and modernization of the Call Report and Credit Union Profile content to leverage technology, improve data collection and enhance the examination process.

“NCUA is committed to continual quality improvement,” Metsger said. “We are therefore carefully examining our processes and operations, asking how NCUA can make these better and more efficient for stakeholders and useful for NCUA. Through this request for information, NCUA will seek to identify ways to reduce or eliminate any potentially unnecessary Call Report burdens and improve NCUA supervision. We will also use this information to find ways to streamline the quarterly reporting process, especially for smaller, non-complex credit unions.”

NCUA uses the data collected in the Call Report to monitor and supervise risk in credit unions and protect the National Credit Union Share Insurance Fund.

Stakeholders will be invited to submit written comments electronically or by mail, and instructions for submission will be included in the upcoming
Federal Register posting. The agency will be gathering information through an open and public process of comment and review that may include using online surveys, focus groups, workshops and other forums. NCUA will also form an internal working that will consult with external stakeholders.

“Once NCUA publishes this request for information, I urge all interested individuals in the credit union system to assist us by providing their insights and suggestions during this comment process,” Metsger said.

NCUA will use stakeholder comments to help improve the user experience, enhance the utility of supervisory data and help minimize the burdens associated with reporting without compromising the agency’s ability to monitor and supervise risk in federal credit unions.

Comments must be received within 60 days of the publication of the request for information in the
Federal Register. NCUA also plans to seek clearance from the Office of Management and Budget to form workgroups that would provide feedback on improvements to the Automated Integrated Regulatory Examination System, or AIRES, and Credit Union Online systems for submitting and storing information.

NCUA tweets all open Board meetings live. Follow

@TheNCUA (opens new window) on Twitter, and access Board Action Memorandums and NCUA rule changes at

www.ncua.gov. NCUA also live streams, archives and posts

videos of open Board meetings online.

ALEXANDRIA, Va. (May 20, 2016) – National Credit Union Administration Executive Director Mark Treichel today announced the selection of Kelly Lay as the agency’s new Business Innovation Director.

Lay, who has served as the Associate Regional Director of Programs in NCUA’s Region II office since 2010, will be responsible for management of the agency’s Enterprise Solutions Modernization program, working alongside the Chief Information Officer. This program, announced at the March 2016 Board meeting, will upgrade NCUA’s information technology capacity, policies and practices. Lay begins her duties May 31.

 
“Kelly brings significant executive and management experience to this position, which is responsible for what will be a major initiative by this agency,” Treichel said. “In her career at NCUA, she has gained valuable insight and perspectives that make her a very good fit for this position and the responsibilities that come with it.”

Lay began her NCUA career in 1996 as a credit union examiner. Since then, she has served in numerous agency positions, including Director of Supervision and Director of Insurance in the agency’s Region V office.

Lay holds a bachelor’s degree in finance, minor in accounting, from Illinois State University and received her Certified Public Accountant designation in 2002.

Industry Leaders Will Discuss Best Practices for Sustainable Growth

ALEXANDRIA, Va. (May 23, 2016) – Successful credit unions achieve sustained growth using multiple strategic initiatives, and the National Credit Union Administration is offering a webinar, “Best Practices to Grow Your Credit Union,” to examine that path to growth.

The webinar is scheduled for Wednesday, June 8, beginning at 2 p.m. Eastern and will run approximately 90 minutes, including a 30-minute question-and-answer session. There is no charge.

Vanessa Lowe, economic development specialist with NCUA’s Office of Small Credit Union Initiatives, will host a panel of three credit union chief executive officers: Jerry Wise, Greensboro Municipal Federal Credit Union, Greensboro, North Carolina; Carolyn DuBois, Greater Niagara Federal Credit Union, Niagara Falls, New York; and Judy Carrasco of Financial Security Credit Union, Carlsbad, New Mexico. The panel will discuss topics that include:

• Loan product offerings,
• Leadership profiles,
• Product and service vendors, and
• Community engagement

Online registration is available here (opens new window). Participants will also use this link to log into the webinar, and they should allow pop-ups from this website. Participants may submit questions in advance at [email protected].  The subject line of the email should read, “Best Practices to Grow Your Credit Union.” Participants with technical questions about accessing the webinar may email [email protected]. This webinar will be closed captioned and then archived online here approximately three weeks following the live event.

NCUA’s Office of Small Credit Union Initiatives fosters credit union development and the effective delivery of financial services for small credit unions, new credit unions, minority depository institutions and credit unions with a low-income designation.

New Filing Schedule Being Studied for Future Call Reports

ALEXANDRIA, Va. (May 23, 2016) – Credit unions will have three extra calendar days to file Call Reports for the second and third quarters of this year, the National Credit Union Administration announced today.

Second-quarter Call Reports will now be due by 11:59:59 p.m. Eastern time on Monday, July 25, instead of Friday, July 22. Third-quarter Call Reports will now be due by 11:59:59 p.m. Eastern time on Monday, Oct. 24, instead of Friday, Oct. 21.

“As we discussed at last week’s open Board meeting, moving the Call Report filing deadline back is a first step in NCUA’s overall effort to improve data collection,” NCUA Board Chairman Rick Metsger said. “In 2014, we moved to a new filing deadline that is generally the fourth Friday of the month following the end of each quarter. That gave credit unions an average of six additional days to file. We’re giving credit unions a little more leeway for the next two quarters as we complete our study on a future deadline closer to the commercial bank deadline that preserves the key role NCUA’s examiners fill in the validation process.”

At its May open Board meeting, NCUA announced the agency will conduct a comprehensive review and modernization of Call Report and Credit Union Profile content. NCUA will gather information through a public comment-and-review process and will create an internal working group that will consult with stakeholders. The process could also include online surveys, focus groups, workshops and other forums. The agency will publish a request for information in the Federal Register in the near future, seeking public comments. Those comments must be received within 60 days of publication.

“I hope credit unions will watch for the publication of our request for information in the Federal Register and submit comments on how we should modernize the Call Report and Credit Union Profile content,” Metsger said, “and I look forward to working with credit unions as this modernization effort proceeds.”

ALEXANDRIA, Va. (May 24, 2016) – The National Credit Union Administration Board has revised its monthly meeting schedule for the remainder of 2016.

Open Board meetings are scheduled to begin at 10 a.m. Eastern on the following dates:

• June 16 
• July 21 
• Sept. 15 
• Oct. 27
• Nov. 17
• Dec. 15

No meeting is scheduled for August, and the meeting schedule is subject to change. 

NCUA’s Board holds open meetings at the agency’s central office located at 1775 Duke St., Alexandria, Virginia.

The Board meeting calendar is available online on the Board Actions page of the agency’s website. This page also has Board agendas, which are posted one week in advance of each open meeting, copies of Board Action Bulletins summarizing the results of each open meeting, copies of Board memorandums and other documents.

NCUA offers a livestream of each open meeting through the main page of its website and provides live updates during all open Board meetings on Twitter, which you also can follow @TheNCUA (opens new window).

NCUA posts videos of open Board meetings as part of the agency’s ongoing efforts to provide transparency and to allow those unable to attend meetings the opportunity to become better informed. An interval between the meeting and posting is necessary for the videos to comply with Section 508 of the Rehabilitation Act for the hearing and visually impaired.

NCUA Exam Flexibility Initiative Seeks Stakeholders’ Experiences and Ideas

ALEXANDRIA, Va. (May 26, 2016) – Credit unions have an opportunity to assist the National Credit Union Administration in efforts to modernize the agency’s examination and supervision program.

NCUA has begun a multi-pronged outreach effort to collect experiences and ideas from credit union system stakeholders through the Exam Flexibility Initiative. This initiative will include meetings and teleconferences, and the agency has already opened an email account for credit unions to provide comments, [email protected], and created a webpage to provide information about the initiative, available online here.

“We are committed to continual quality improvement and, in particular, to modernizing the examination process, the agency’s largest function,” NCUA Board Chairman Rick Metsger said. “More than 102 million account holders trust us to protect their hard-earned money, so our program needs to continue to be as effective as we can make it, but it also needs to be efficient for credit unions. I’m looking forward to a thoughtful dialog with stakeholders on how we can improve this program, place fewer burdens on credit unions and protect members’ deposits.”

Metsger announced May 12 that NCUA would begin reviewing the examination process, including the frequency of examinations, through the establishment of an internal working group, which will include representatives from all five of the agency’s regional offices and its central office. Region IV Director Keith Morton is leading the effort.

NCUA presented five questions for credit unions to consider to help stimulate this discussion:

• How can NCUA conduct future examinations in ways that minimize their impact on credit unions’ operations?
• What concerns do credit unions have about the current examination and supervision program?
• What steps should NCUA take to improve the efficiency of its examination program while ensuring it remains effective?
• How can NCUA better use technology in examinations?
• What metrics should NCUA consider to determine a credit union’s eligibility for an extended examination cycle?

Metsger has said he wants to make changes to the examination process “sooner rather than later.”

Registration with the System for Award Management is Now Required

ALEXANDRIA, Va. (May 26, 2016) – With a new registration system now required for grant applicants, low-income credit unions seeking Community Development Revolving Loan Fund assistance grants should give themselves adequate time to file, the National Credit Union Administration said today.

The application deadline is June 30.

Applicants are now required by federal law to register with the government’s System for Award Management (opens new window). Registration is necessary for NCUA to meet federal grant disclosure requirements, and instructions for creating an account and registering your credit union are available on the “Help Documents” section of the Office of Small Credit Union Initiatives’ Grants and Loans information page. Instructions may also be found on the System for Award Management’s website. There is no registration fee.

Credit unions with questions about registering should contact the Federal Service Desk (opens new window) online or by telephone at 866-606-8220. For questions about the Community Development assistance grants, contact NCUA’s Office of Small Credit Union Initiatives at [email protected].

Credit unions may submit one application for all initiatives using NCUA’s CyberGrants program (opens new window). Each credit union may apply for more than one initiative; however, grant awards are subject to the availability of funds.

The four eligible initiatives and maximum grant awards are:

• Capacity and growth: Credit unions considering new lending programs, deposit products or other growth strategies to increase members’ financial service opportunities may apply for up to $15,000 in assistance.
• Cyber security: Up to $7,000 will be available for each eligible credit union to enhance cyber security and protect member information.
• Staff training: Grants of up to $3,000 will be available for selected credit unions to pay for training related to credit union operations, including compliance, lending and collections.
• Student internships: Up to $4,000 will be available to each credit union to hire students enrolled in high school or college.

A full list of eligible grant projects and NCUA’s evaluation criteria can be found online here.

NCUA’s Office of Small Credit Union Initiatives administers the Community Development Revolving Loan Fund grants. The office also fosters credit union development and the effective delivery of financial services for small credit unions, new credit unions, minority depository institutions and credit unions with a low-income designation.

Agency Committed to Supporting Service Members and Hiring Veterans

ALEXANDRIA, Va. (May 27, 2016) – National Credit Union Administration Board Member J. Mark McWatters will serve as the agency’s liaison to the Defense Credit Union Council.

McWatters takes over this responsibility at the request of NCUA Board Chairman Rick Metsger.

“I am looking forward to working with the members of the Council, which serves the credit unions whose members serve in our nation’s armed forces,” McWatters said. “Since joining NCUA’s Board, I have advocated that we best serve the variety of interests in the credit union community by working with and listening to them directly. This will be another chance to hear from those whose job it is to meet the distinct financial needs of their members.”

“As we commemorate Memorial Day this weekend, we are reminded of the selfless sacrifices of the men and women who died while serving in our armed forces,” Metsger said. “NCUA can best honor their memories by hiring qualified veterans, educating service members and maintaining strong connections with the credit unions that serve our military men and women at home and abroad. I appreciate Board Member McWatters’ accepting this position, and I know it will help us maintain a productive working relationship between NCUA and the Council.”

Organized in 1963, the Defense Credit Union Council (opens new window) represents the interests of credit unions operating on military installations world-wide. The Council has more than 200 member credit unions, which serve more than 18 million members.

NCUA Supports Active-Duty Service Members and Veterans

By providing financial education resources for service members and employment opportunities for veterans, NCUA supports America’s service members and veterans year round.

The agency has a webpage dedicated to resources for service members (opens new window) on its Pocket Cents financial literacy website. Each year, NCUA joins with the non-profit, America Saves, the Department of Defense’s Financial Readiness Campaign, and other partners to host activities during Military Saves Week (opens new window). The week seeks to motivate, support and encourage military families to save money, reduce debt and build wealth.

NCUA is also a leader in hiring veterans. The Partnership for Public Service’s 2015 “Best Places to Work in the Federal Government” report ranked NCUA first among veterans at middle-sized government agencies, and DiversityComm, Inc., has previously ranked NCUA as one of its “Best of the Best” places for veterans to work.

In 2013, NCUA signed an agreement with the Department of Veterans Affairs to create more employment opportunities for veterans and promote greater workforce diversity in the agency through the Feds for Vets program. In 2015, 30 percent of the agency’s new hires were veterans; 19 percent of new hires were disabled veterans. Today, veterans make up nearly 17 percent of NCUA’s workforce.

2016 National Exam Program Training More than 18 Percent below Budget

ALEXANDRIA, Va. (May 27, 2016) – As the credit union system grows and changes, National Credit Union Administration examiners are being trained to keep pace and continue to provide credit unions and their members with high-quality service.

The agency’s biennial training program, with the theme of “Making a Difference,” gave examiners and other staff opportunities for the kind of professional development necessary to maintain that level of service.

“More than 102 million credit union members depend on us to protect their money,” NCUA Executive Director Mark Treichel said. “Essential to that responsibility is training examiners to the highest professional levels and educating them about changes in the industry and in technology, so they can apply their skills most effectively. This benefits credit unions, as well, because we’re helping make the examination process itself work more efficiently.”

The 2016 National Exam Program Training provided 900 NCUA staffers with a skills development program that included wide-ranging sessions on cyber security, member-business lending, managing examinations, interest-rate risk and consumer protection issues. In addition, attendees received training in workplace violence and security awareness, workplace diversity and recognizing everyday biases. They also heard from leading experts on emerging trends in cybercrime.

Participants attended both general workshops and break-out sessions that provided opportunities to discuss issues in greater depth and included practical exercises aimed at giving them hands-on experiences.

The “Making a Difference” training program, held between April 4 and April 15 in Denver, came in $404,121 below its Board-approved budget, a savings of more than 18 percent. The 2016 training event cost $128,268 less than the 2014 National Training Conference. A budget summary for the 2014 and 2016 training programs is provided below.

Treichel said attendees left the 2016 session prepared for an environment that poses new and more complex challenges.

“Our field staff are based across the country, and bringing them together in one place not only makes the training process more efficient and cost-effective, but it also gives them more opportunities to share ideas and learn from their professional peers,” he said.

Total participants includes support staff for the training program. The per diem calculation is based on the General Services Administration’s rate of $69 per day. NCUA paid $139 per night lodging. Travel costs are estimated based on actual costs to date.