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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.

Learn about Internal Controls, Red Flags and Accounting Standards Changes

ALEXANDRIA, Va. (May 31, 2016) – Strong internal controls and accurate accounting are essential to safe and sound credit union operations, and the National Credit Union Administration will host a webinar to discuss important topics in these areas.

The webinar, “Internal Controls and Accounting Tips for Small Credit Unions, Part II,” is scheduled for Wednesday, June 22, at 2 p.m. Eastern. The webinar will run approximately 90 minutes and include a 30-minute question-and-answer session. There is no charge.

Dominic Carullo, an economic development specialist with NCUA’s Office of Small Credit Union Initiatives, will moderate a panel that includes NCUA Supervision Director Scott Neat, Region IV supervision analyst Carolyn Penaluna, and Region III examiner, Kerri Piekarski. Our panel will follow up on topics discussed during part one of this series, including:

• Expected changes to the allowance for loan losses;
• Best internal control practices for small credit unions;
• Understanding grant accounting; and
• The NCUA Call Report.

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, “Internal Controls and Accounting Part II.” 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.

NCUA Releases “CUSOs at a Glance” to Provide Annual Snapshot of the Sector

ALEXANDRIA, Va. (June 1, 2016) – Stakeholders will be able to gain a better understanding of credit union service organizations with the addition of a search feature to the National Credit Union Administration’s CUSO Registry.

Users can search for information on the nearly 900 registered CUSOs by name, city, state, zip code, registry number or services. Users can also export the data into Excel, CVS and PDF formats. Users can access the searchable registry by going to https://cusoregistry.ncua.gov/Search/ (opens new window).

The CUSO Registry is part of NCUA’s enhanced credit union service organization rule approved by the NCUA Board in November 2013.

NCUA Releases New “CUSOs at a Glance”

In addition, NCUA has developed a new, annual fact sheet on the CUSO sector. The CUSOs at a Glance fact sheet provides key metrics, including the levels of credit union investments in CUSOs, the percentage of CUSOs wholly owned by a single credit union, the number of credit unions CUSOs serve and the types of services CUSOs provide, among other data.

Key findings at the end of 2015 include:

• CUSOs reported more than $1.3 billion in investments from credit unions.
• CUSOs reported more than $447 million in loans from credit unions.
• A majority, 74 percent, of CUSOs were wholly owned by a credit union, with only five CUSOs reporting more than 100 credit union owners. One CUSO reported having more than 1,000 credit union owners.
• The majority, 95 percent, of CUSOs serve less than 100 credit union customers, with 67 percent of CUSOs serving only one credit union customer.
• The top four CUSO services are lending, member services, other services, and payment and electronic transaction processing.
• Nine states—Texas, California, Virginia, Michigan, New York, Florida, Pennsylvania, Indiana and Massachusetts—have 30 or more CUSOs headquartered within the state.

Interested stakeholders can view the 2015 CUSOs at a Glance online here (opens new window).

Learn about the CDFI Fund-NCUA Joint Effort to Certify More Credit Unions 

ALEXANDRIA, Va. (June 1, 2016) – Low-income credit unions interested in becoming certified as Community Development Financial Institutions can get valuable information from an upcoming webinar, “CDFI Certification –Special Credit Union Version,” hosted by the National Credit Union Administration.

The webinar, is scheduled for Thursday, June 23, beginning at 2 p.m. Eastern. There is no charge.

NCUA and the Community Development Financial Institutions Fund are jointly engaged in an initiative to double the number of certified credit unions by the end of this year. The webinar will highlight the automation of existing data sources to streamline the application process.

Vanessa Lowe, economic development specialist with NCUA’s Office of Small Credit Union Initiatives, will be joined by three staff members from NCUA’s Office of Small Credit Union Initiatives — Pamela Williams, partnership and outreach analyst; Diane Rector, economic development specialist supervisor and training manager; Malia Peel, economic development specialist supervisor and project manager — and by Michelle Dickens, senior program analyst with the Community Development Financial Institutions Fund. Participants will also hear from two credit unions about their experiences going through the certification process.

Online registration for this 90-minute webinar is now open here (opens new window). Participants will use this same link to log into the webinar. Registrants should allow pop-ups from this website. Participants may submit questions in advance at [email protected].  The email’s subject line should read, “CDFI Certification – Special Credit Union Version.”

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.

In preparation for this webinar, please view the video “CDFI — Introduction and Overview (opens new window),” part of NCUA’s Community Development Financial Institutions certification video series.

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.

Learn More about Enhanced Protections for Service Members and Their Families

ALEXANDRIA, Va. (June 2, 2016) – The National Credit Union Administration will host a webinar, “Preparing to Comply with Regulatory Changes to the Military Lending Act,” on Wednesday, June 29, starting at 2 p.m. Eastern.

During this webinar, staff from NCUA’s Office of Consumer Protection will provide a high-level overview of the significant changes to the regulation implementing the Military Lending Act, most of which go into effect by Oct. 3. The law now covers most non-mortgage-related consumer credit extended to active duty service members and certain dependents.

The webinar will review topics like:

• Transactions the rule covers, including credit card accounts;
• Who is covered under the rule’s protections;
• How to determine who is a covered borrower; and
• How the new rule applies to NCUA’s rule on payday alternative loans.

Online registration for this 90-minute webinar is now open here (opens new window). Participants will use this same link to log into the webinar. Registrants should allow pop-ups from this website. There is no charge for participating in this webinar.

Prior to the webinar, participants are encouraged to review two NCUA Regulatory Alerts issued in March 2016 and October 2015. These alerts explain the scope of the new rules, the safe harbors available to credit unions and other details to help bring credit unions into compliance before the rule’s effective date. They also provide information about the compliance resources available on NCUA’s and the Consumer Financial Protection Bureau’s websites.

Participants may submit questions in advance at [email protected]. The subject line of the email should read, “MLA Regulatory Amendments.” Participants with technical questions about accessing the webinar may email [email protected].  NCUA will closed caption and then archive the webinar online here approximately three weeks following the live event.

NCUA’s Office of Consumer Protection handles consumer protection compliance policy and rulemaking, chartering and field of membership, fair lending examinations, consumer complaint resolution, interagency coordination and outreach and the agency’s financial literacy programs.

ALEXANDRIA, Va. (June 3, 2016) – Credit unions continued to increase their lending, with loans outstanding increasing 10.7 percent in the year ending in the first quarter of 2016, the National Credit Union Administration reported today.

“The credit union system again experienced solid performance during the first quarter of 2016,” NCUA Board Chairman Rick Metsger said. “Overall, new and used auto lending was especially strong, and the system gained one million members. With an influx of deposits, federally insured shares at credit unions also neared the $1 trillion mark coming in at $991.7 billion.

“As credit union lending has increased, long-term investments have declined and reduced the system’s interest rate risk. However, delinquency and charge-off rates are slightly higher than a year ago, and member-business loan delinquencies are rising even more. Credit unions making such loans should take note and ensure that they perform proper due diligence to mitigate the risk.”

NCUA released the new figures today, based on Call Report data submitted to and compiled by the agency for the quarter ending March 31, 2016.

Auto, Mortgage and Member Business Lending Continue Growth

Total loans at federally insured credit unions reached $799.5 billion at the end of the first quarter, an increase of 10.7 percent from one year earlier.

Year over year, loans grew in every major category, including:

• New auto loans jumped 15.4 percent to $103.0 billion.
• Used auto loans rose 13.2 percent to $166.8 billion.
• Total first-mortgage loans outstanding grew 10.4 percent to $327.9 billion.
• Other real estate loans grew by 3.9 percent to $74.3 billion.
• Net member-business loan balances increased 13 percent to $59.8 billion.
• Non-federally guaranteed student loans expanded 10.9 percent to $3.6 billion.
• Payday alternative loans originated at federal credit unions rose 8.1 percent to $106.1 million at an annual rate.

Additionally, the loans-to-shares ratio on March 31 was 76.1 percent, up 2.7 percentage points from a year earlier. The ratio, however, fell for the quarter due to an influx of member deposits.

Long-Term Investments Continue to Decline

Total investments, defined as investments greater than three months, by federally insured credit unions stood at $272.4 billion at the end of the first quarter, down 2.8 percent over the last year. Investments with maturities greater than 10 years remained unchanged from the previous quarter at $4.5 billion, though they were down 14.9 percent from the first quarter of 2015.

Investments with maturities of one to three years were $103.5 billion in the first quarter. Overall, these investments have declined 3.3 percent during the last year. The system’s ratio of net long-term assets to total assets came in at 31.7 percent, down 0.8 percentage point from a year ago and the lowest level since the third quarter of 2010.

Overall Delinquency and Charge-Off Rates Rise Slightly

The delinquency rate at federally insured credit unions was 71 basis points in the first quarter, up 2 basis points from a year earlier. The delinquency rate for fixed real estate was down for the last four quarters, but the delinquency rates for credit cards and member business loans rose with member-business loan delinquencies rising faster, coming in at 141 basis points on March 31.

The system’s net charge-off ratio increased slightly to an annualized 52 basis points in the first quarter, up from 47 basis points at the end of the first quarter of 2015.

Asset and Deposit Increases Continue

Total assets in federally insured credit unions rose to more than $1.2 trillion at the end of March, an increase of 7.1 percent for the year ending in the first quarter. Deposits at federally insured credit unions increased 6.8 percent during the same period to nearly $1.1 trillion.

Credit Unions Remain Well Capitalized

The percentage of federally insured credit unions that were well capitalized remained steady in the first quarter with 97.8 percent reporting a net worth ratio at or above the statutorily required 7 percent. At end of first quarter of 2016, 0.7 percent of federally insured credit unions were less than adequately capitalized.

Overall, the credit union system’s aggregate net worth ratio was 10.78 percent at the end of the first quarter, down 3 basis points from a year earlier.

Membership Nears 104 Million, Even as Consolidation Continues

Membership in federally insured credit unions grew to 103.7 million in the first quarter of 2016, an increase of 3.8 percent from the first quarter of 2015. In all, credit unions have added 1 million members during the quarter and 13 million members during the last five years.

Continuing a long-standing trend, the number of federally insured credit unions fell to 5,954 at the end of the first quarter of 2016, 252 less than a year ago. The decline occurred primarily in the number of credit unions under $10 million in assets. Overall, there were 3,721 federal credit unions and 2,233 federally insured, state-chartered credit unions.

Credit Unions’ Net Income Increases; Return on Average Assets Ratio Steady

Federally insured credit unions reported net income of $9.2 billion on an annualized rate in the first quarter of 2016, up 3.5 percent from the $8.9 billion reported in the first quarter a year ago.

The annualized return on average assets ratio for federally insured credit unions stood at 75 basis points the first quarter in 2016, down 3 basis points from a year earlier.

Larger Credit Unions Again Lead the System in Performance

Federally insured credit unions with more than $500 million in assets led the system in most performance measures in the first quarter of 2016, continuing a long-standing trend.

With $902.5 billion in combined assets, these 493 credit unions—up from 481 at the end of 2015—held 72.7 percent of total system assets. The 4,414 credit unions with less than $100 million in assets held 8.6 percent of the system’s total assets.

As in previous quarters, large credit unions again reported the fastest growth in loans, membership and net worth, as well as the highest return on average assets. Credit unions with assets of less than $10 million, as a whole, experienced declines in loans and membership. Credit unions with assets between $10 and $100 had positive net worth and membership growth, but experienced a slight decline in loan growth.

For selected metrics, the table below provides a summary by asset size of federally insured credit unions’ current ratios and annualized growth rates at the end of the first quarter of 2016:

Summary Metrics by Asset Size of Federally Insured Credit Unions

Metric	More than $500 million	$100 million to $500 million	$10 million to $100 million	Less than $10 million
Number of Credit Unions	493	1,047	2,659	1,755
Net Worth Ratio	10.6 percent	10.8 percent	11.7 percent	14.9 percent
Net Worth Growth	Up 8.4 percent	Up 5.9 percent	Up 2.9 percent	Up 0.4 percent
Loan Growth	Up 7.8 percent	Up 4.9 percent	Down 0.1 percent	Down 4.7 percent
Membership Growth	Up 6.0 percent	Up 3.0 percent	Up 0.3 percent	Down 0.9 percent
Return on Average Assets	87 basis points	51 basis points	32 basis points	5 basis points

 

For more information about the performance of federally insured credit unions, NCUA makes the complete details of the March 2016 Call Report available online here. An expanded summary of first-quarter performance is available here, and financial trends data for federally insured credit unions are available here.

 

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