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NCUA just released its 2026-2030 Strategic Plan, laying out the agency's priorities for the next five years. Here's what credit union leaders should know.

What NCUA is announcing:

• Three strategic goals: safeguarding federally insured credit unions, enabling access to cooperative financial services and responsible innovation, and strengthening the agency's own capabilities and performance
• A comprehensive review of the regulatory framework to remove rules that are outdated, duplicative, or unnecessarily burdensome
• Expanded use of data, analytics, and AI tools in examination and supervision
• A push to foster responsible adoption of financial technology, digital assets, and blockchain-based innovation
• Streamlined chartering, field of membership, and expansion processes
• Internal restructuring focused on core statutory functions, merit-based hiring, and reduced duplication

Why the change is occurring:

• Feedback from NCUA's first-ever Strategic Planning Town Hall in September 2025 with credit unions, leagues, trade associations, and CUSOs
• A financial services environment evolving rapidly with AI, digital assets, and shifting member expectations
• Presidential executive orders and laws like the GENIUS Act driving new regulatory responsibilities
• A recognition that disciplined, risk-focused supervision serves both safety and soundness and member access

What is NOT changing:

• NCUA's core mission: enabling access to financial services by facilitating safe, sound, and resilient credit unions
• Statutory responsibility to protect the Share Insurance Fund and credit union members
• Risk-focused examination framework (it's being refined, not replaced)
• Coordination with FFIEC, FSOC, and state regulators
• Agency values: results, integrity, teamwork, and accountability

10,000-foot takeaway: NCUA is signaling a lighter, more targeted regulatory touch paired with a modernized, tech-enabled supervisory approach. Expect continued focus on material risks, fewer administrative burdens, and more room for credit unions to innovate responsibly, while the Share Insurance Fund and safety-and-soundness remain non-negotiable.

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• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

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NCUA Proposes to Loosen Associational Common Bond Rules

The NCUA Board has issued a proposed rule that would amend the associational common bond provisions of its Chartering and Field of Membership Manual. Comments are due by June 8, 2026.

What NCUA is proposing:

• Eliminate the automatic bar that currently disqualifies an associational group from FCU field of membership eligibility when the group requires purchasing a product or service as a condition of membership.
• Replace the bright-line rule with a totality of the circumstances review, looking at the group's structure, scope, degree of activities, and other operational factors.
• Clarify that a client-customer relationship can exist, even as a condition of membership, as long as it remains incidental to the group's overall purpose and activities.
• Use an example of a fraternal association that requires insurance purchase - under the proposal, this would no longer be automatically disqualifying.

Why the change:

• The Board believes the automatic bar goes beyond what the FCU Act actually requires.
• Neither the FCU Act nor the Credit Union Membership Access Act of 1998 (CUMAA) specifies that a client-customer relationship is automatically disqualifying.
• The change is intended to enhance consumer access to financial services and eliminate an inflexible restriction, consistent with Executive Order 13563 and deregulatory goals under Executive Order 14192.
• Moves NCUA toward a principles-based approach rather than a rigid rule.

What is NOT changing:

• Associations based primarily on a client-customer relationship still do not qualify.
• Health clubs, including YMCAs, remain examples of groups that do not meet the associational common bond requirements.
• Retail loyalty clubs still would not qualify, since their core reason for existence is the client-customer relationship.
• The rule does not affect occupational common bond charters, community charters, or federally insured state-chartered credit unions.
• The core associational common bond definition - members of a recognized association who participate in activities developing common loyalties, mutual benefits, and mutual interests - remains intact.
• Pre-approved categories of groups under the 2015 automatic qualification amendments are unaffected.

10,000-foot takeaway: NCUA is moving from a rigid "if you require a purchase, you're out" standard to a more flexible "look at the whole picture" standard. Associational groups that previously couldn't qualify because membership required buying a product or service may now have a path forward - but only if the client-customer piece is genuinely incidental to why the group exists. If selling something is the core reason the group was formed, the group still doesn't qualify. For FCUs looking to expand their field of membership through associational groups, this proposal could open doors that have been closed for decades.

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• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

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The NCUA just released its 2026 Supervisory Priorities (Letter 26-CU-01), giving credit unions a heads-up on where examiners will be focusing this year.

Here's what you need to know:

• The NCUA is doubling down on balance sheet management, with particular attention to lending, interest rate risk, liquidity, earnings, and capital adequacy. Loan delinquency and loss rates are at their highest in over a decade, and examiners will be looking closely at underwriting, loss mitigation, ACL reserves, and charge-off practices.
• Operational risk is a major theme. Payment systems, fraud prevention, and cybersecurity will all get heightened scrutiny as the payments landscape grows more complex and fraud risks continue to rise.
• BSA/AML compliance remains a priority, with an emphasis on risk-based programs tailored to each credit union's profile. Expect regulatory changes throughout the year as FinCEN and the NCUA continue implementing provisions of the Anti-Money Laundering Act of 2020.
• The agency is also signaling a shift toward a more efficient and tailored examination program, building on its 2025 efforts to reduce burden for both credit unions and NCUA staff. Defined scope exams will continue for most federal credit unions with $50 million or less in assets.

What is NOT changing: The NCUA will continue enforcing all existing laws and regulations, including consumer financial protection and information security requirements. Risk-focused procedures remain the standard for larger credit unions.

The 10,000-foot takeaway: Asset quality and earnings pressure are the story of 2026. Credit unions that can demonstrate strong risk management practices across lending, liquidity, and capital planning will be well positioned. Now is the time to review your ACL methodologies, stress testing, contingency funding plans, and BSA programs before examiners come knocking.

One more thing worth noting: the NCUA reminds credit unions they may record their final exit meeting or joint conference for documentation and training purposes.

If your credit union could use help preparing, visit MarkTreichel.com or reach out to Mark Treichel on LinkedIn.

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• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

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Changes for Corporate Credit Unions – 12 CFR 704.8 and 704.15

• NCUA is proposing to amend its regulations for corporate credit unions by removing the requirement that a corporate credit union’s asset and liability management committee (ALCO) must have at least one member who is also a member of the corporate credit union’s board of directors.

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• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

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 the Board, seeks comment on a proposed rule to remove the segregated deposit and collateral requirements when a federally insured credit union, referred to as a F I C U, acts as a surety and guarantor. Removing this regulation will provide F I C U s with greater flexibility to design products that meet member needs. F I C U s would remain subject to the other requirements regarding surety and guaranty agreements. 

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• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

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NCUA's 2026 Priority Letter to Credit Unions is out!

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 The NCUA Board, referred to as the Board, is issuing this proposed rule to streamline its regulations governing advertising and the notice of insured status. This proposed rule would eliminate provisions concerning the official advertising statement. This action is undertaken to reduce regulatory complexity, and the intended effect is to reduce the administrative burden and costs for federally insured credit unions, referred to as FICU s, and provide them with greater flexibility in their advertising activities. The proposed rule would not amend requirements related to displaying the official sign. 

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 The NCUA Board seeks comment on a proposed rule to remove the regulations related to approval and policies on making loans to other credit unions. While this provision would no longer be codified in regulation, Federal Credit Unions would remain subject to statutory requirements related to making loans to credit unions. Federally insured state-chartered credit unions would remain subject to any other applicable NCUA or state law or regulation. 

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 The N C U A Board is publishing this proposed rule to amend the requirements for federally insured credit unions to report catastrophic acts to the agency. By providing more time for federally insured credit unions to notify the agency of the occurrence of a catastrophic act and by eliminating the specific list of items to be documented, the Board expects the proposed rule to reduce the compliance burden and allow federally insured credit unions to focus their resources on recovery and core functions without compromising safety and soundness. 

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Episode Title

Credit Card Risk, Consumer Stress, and the 18 Percent Reality

Episode Description

In this episode, Samantha Shares reviews key findings from the Consumer Financial Protection Bureau’s latest Consumer Credit Card Market Report and explains what they mean for credit unions.

The discussion focuses on how credit card usage has evolved since the pandemic, where growth is occurring, and why consumer stress signals remain elevated even as delinquency rates normalize. Samantha also explains how credit unions manage credit card risk differently from large banks, particularly given the statutory 18 percent loan-rate cap.

This episode is designed to provide practical context for credit union leaders, board members, and exam preparation conversations.

Key Topics Covered

• How large the credit card market has become and how embedded cards are in daily life
• Why recent credit card spending growth is concentrated among higher-credit-score borrowers
• What rising balances and minimum-payment behavior signal about consumer stress
• Why normalization in delinquency rates does not necessarily mean household finances are healthy
• How credit cards are increasingly used for essential expenses rather than discretionary spending
• Why smaller issuers hold a larger share of higher-risk credit card balances
• How credit unions manage credit card risk under the 18 percent loan-rate cap
• The growing importance of underwriting discipline, credit limits, monitoring, and servicing controls
• Operational risk trends, including disputes tied to recurring transactions
• How innovation, artificial intelligence, and alternative payment methods may shape future card usage

Why This Episode Matters

Credit unions operate in a high-rate environment with uneven consumer stress while serving a membership base that often includes higher-risk borrowers. Understanding how credit card risk is distributed across the market—and how credit unions manage that risk structurally rather than through pricing—is essential for strategy, governance, and exam readiness.

Sponsor Message

This podcast is sponsored by Credit Union Exam Solutions Incorporated. Their team has over two hundred and forty years of National Credit Union Administration experience and helps credit unions prepare for and navigate NCUA examinations.

Learn more at MarkTreichel.com.

Related Content

• With Flying Colors podcast
• Credit Union Regulatory Guidance podcast
• Articles and resources at MarkTreichel.com

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• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

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Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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Changes for Guidelines for Safeguarding Member Information – 12 CFR 748 Appendix A

• NCUA is proposing to remove Appendix A to part 748, guidelines for safeguarding member information, from the Code of Federal Regulations.

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• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

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Show Notes
In this episode of Samantha Shares, we present an audio version of the Semiannual Risk Perspective from the National Risk Committee, Fall 2025, issued by the Office of the Comptroller of the Currency.

This report provides a comprehensive overview of conditions in the federal banking system, including balance sheet strength, capital and liquidity levels, earnings performance, and emerging risks. The document discusses trends in credit quality across major loan categories, underwriting standards, commercial real estate conditions, and market and liquidity risk. It also highlights key operational and compliance considerations, including cybersecurity threats, fraud risk, and the evolving regulatory environment.

The report examines the role of financial innovation, including artificial intelligence and payment system developments, and outlines how banks are balancing innovation opportunities with governance and risk management expectations. It concludes with an assessment of the economic environment and bank performance, including interest rate trends, profitability, and resilience under potential stress.

This episode is a near-verbatim spoken reading of the source document. It is provided for educational purposes only and is not legal advice.

Sponsor
This episode is sponsored by Credit Union Exam Solutions Incorporated. Our team has over two hundred and forty years of National Credit Union Administration experience and assists credit unions with NCUA examinations so they can save time and money. Learn more at Mark Treichel dot com.

Related Podcast
Be sure to also check out our companion podcast, With Flying Colors, where we share practical insights and strategies to help credit unions achieve success with NCUA.

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• Strategies to address potential issues before they become problems

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Changes for Guidance on Response Programs for Unauthorized Access to Member Information and Member Notice – 12 CFR 748 Appendix B

• NCUA is proposing to remove Appendix B to part 748, guidance on response programs for unauthorized access to member information and member notice, from the Code of Federal Regulations.

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• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

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"Most banks maintained relatively consistent reliance on Federal Home Loan Bank advances — including during periods of financial stress."
— Government Accountability Office

The GAO just dropped a detailed report examining the Federal Home Loan Bank system during COVID-19 and the March 2023 banking stress.

Here's what they actually found (without the noise):

What the data shows:
• FHLBank advances functioned as a stabilizing liquidity tool — not a risk amplifier
• Especially true for institutions under $10 billion in assets
• Consistent usage patterns even during stress periods
• No evidence of panic borrowing or destabilizing effects

Why it matters: While everyone was wringing their hands about liquidity risk, most community institutions used FHLBanks exactly as designed — as a reliable backstop when deposits got shaky.

The real takeaway: For smaller institutions, FHLBank membership provided stability when they needed it most. Not a crutch. Not a risk factor. Just a tool that worked.

I've posted a ~9-minute audio summary walking through what the GAO actually found.

🎧 Listen at MarkTreichel.com or on your favorite podcast app (Samantha Shares).

Translation: FHLBanks did their job. The system worked as intended.

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• Strategies to address potential issues before they become problems

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Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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Changes for Supervisory Committee Audits and Verifications – 12 CFR 715

• NCUA is proposing to amend its regulations governing supervisory committee audits to eliminate unnecessary, redundant, and overly prescriptive provisions.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

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• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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NCUA Announces Deregulation Project and First Round of Proposed Regulatory Changes

Stakeholders Are Encouraged to Review Notice of Proposed Rulemaking and Submit Comments

ALEXANDRIA, VA (December 10, 2025) – The National Credit Union Administration today announced the first round of proposed regulatory changes associated with a new initiative to review and potentially revise the agency’s regulations. This initiative, NCUA’s Deregulation Project, follows
This is an external link to a website belonging to another federal agency, private organization, or commercial entity.Executive Order 14192, Unleashing Prosperity Through Deregulation
(Opens new window).

NCUA’s Deregulation Project will involve a comprehensive review of regulations documented in Title 12, Chapter VII of the Code of Federal Regulations. This review will ensure the regulations are focused on the safety, soundness, or resilience of credit unions. Further, NCUA will propose changing or removing regulations that are:

• Obsolete;
• Duplicative of statutory requirements;
• Intended to serve as guidance, not requirements; or
• Overly burdensome.

In addition to announcing the project, NCUA is requesting comments on four proposals that would clarify agency guidance or eliminate unduly burdensome or obsolete requirements in
This is an external link to a website belonging to another federal agency, private organization, or commercial entity.the Federal Register
(Opens new window).

The four proposals include:

• Changes for Corporate Credit Unions – 12 CFR 704.8 and 704.15
  • NCUA is proposing to amend its regulations for corporate credit unions by removing the requirement that a corporate credit union’s asset and liability management committee (ALCO) must have at least one member who is also a member of the corporate credit union’s board of directors.
  • For more information on this proposal, please see:
    This is an external link to a website belonging to another federal agency, private organization, or commercial entity.https://www.federalregister.gov/public-inspection/2025-22487/corporate-credit-unions
    (Opens new window)
• Changes for Supervisory Committee Audits and Verifications – 12 CFR 715
  • NCUA is proposing to amend its regulations governing supervisory committee audits to eliminate unnecessary, redundant, and overly prescriptive provisions.
  • For more information on this proposal, please see:
    This is an external link to a website belonging to another federal agency, private organization, or commercial entity.https://www.federalregister.gov/public-inspection/2025-22488/supervisory-committee-audits-and-verifications
    (Opens new window)
• Changes for Guidelines for Safeguarding Member Information – 12 CFR 748 Appendix A
  • NCUA is proposing to remove Appendix A to part 748, guidelines for safeguarding member information, from the Code of Federal Regulations.
  • For more information on this proposal, please see:
    This is an external link to a website belonging to another federal agency, private organization, or commercial entity.https://www.federalregister.gov/public-inspection/2025-22489/guidelines-for-safeguarding-member-information
    (Opens new window)
• Changes for Guidance on Response Programs for Unauthorized Access to Member Information and Member Notice – 12 CFR 748 Appendix B
  • NCUA is proposing to remove Appendix B to part 748, guidance on response programs for unauthorized access to member information and member notice, from the Code of Federal Regulations.
  • For more information on this proposal, please see:
    This is an external link to a website belonging to another federal agency, private organization, or commercial entity.https://www.federalregister.gov/public-inspection/2025-22490/guidance-response-programs-for-unauthorized-access-to-member-information-and-member-notice
    (Opens new window)

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n this episode of Samantha Shares, we present the verbatim text of the N C U A’s proposed rule on  Elimination of Reputation Risk.

The document covers:

• A Summary of the proposed rule to eliminate reputation risk from N C U A’s supervisory framework.
• Background and Policy Objectives — why reputation risk is subjective, inconsistent, and prone to examiner bias.
• Legal Authority — the Federal Credit Union Act provisions that give N C U A power to regulate.
• Description of the Proposed Rule and Changes — prohibiting examiners from citing, criticizing, or taking action against credit unions for reputation risk, including political, cultural, or religious reasons.
• Expected Effects — how this will affect all 4,370 federally insured credit unions, their members, and business partners.
• Regulatory Procedures — transparency, cost analysis, and references to Executive Orders and statutory requirements.

The proposal directly addresses concerns that reputation risk was being misused in examinations, particularly around politically sensitive or lawful but disfavored activities.

This audiobook-style episode presents the full Federal Register text as released, unedited and verbatim, for educational purposes.

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Hello, this is Samantha Shares. This episode covers the Fair Credit Reporting Act; Preemption of State Laws. The following is an audio version of that document. This podcast is educational and is not legal advice. We are sponsored by Credit Union Exam Solutions Incorporated, whose team has over two hundred and forty years of National Credit Union Administration experience. We assist our clients with N C U A so they save time and money. If you are worried about a recent, upcoming, or in-process N C U A examination, reach out to learn how they can assist at Mark Treichel DOT COM. Also check out our other podcast called With Flying Colors, where we provide tips on how to achieve success with N C U A. And now, the Fair Credit Reporting Act; Preemption of State Laws.

The Consumer Financial Protection Bureau is issuing this interpretive rule to clarify that the Fair Credit Reporting Act broadly preempts state laws that attempt to regulate credit reporting. This action reflects Congress’s original intent to create national standards for the credit reporting system. This interpretive rule replaces an earlier Bureau rule from July twenty twenty-two, which had taken a narrower view of preemption. That rule was withdrawn in May twenty twenty-five.

The Fair Credit Reporting Act, or F C R A, was enacted in nineteen seventy and has been amended several times since. It established a national system for credit reporting and set rules for consumer reports and the use of consumer information. From the beginning, the law preempted state laws that were inconsistent with its provisions. In nineteen ninety-six, Congress strengthened this preemption by adding a new clause that barred states from regulating in certain specifically identified areas. This was meant to avoid a patchwork of conflicting rules. Originally, this stronger preemption was set to expire in two thousand four, but in two thousand three, Congress made it permanent. The intent was clear: to preserve uniform national standards and support the growth of the national credit reporting system.

In July twenty twenty-two, the Bureau published an interpretive rule suggesting that section sixteen eighty-one tee, subsection b, paragraph one, had only a narrow sweep. It concluded that many state laws affecting consumer reports could stand alongside federal law. For example, it suggested that state laws regulating medical debt, rental history, or arrest records could coexist with the F C R A. That interpretation was controversial. In May twenty twenty-five, the Bureau withdrew that interpretive rule, stating that it was unnecessary and that agencies lack special authority to interpret preemption unless Congress specifically delegates it. The Bureau also found that the twenty twenty-two rule created confusion and risked imposing higher compliance burdens. The Bureau now clarifies that the prior interpretation was flawed. The F C R A’s preemption clause was written in broad terms and must be applied broadly.

The text of section sixteen eighty-one tee, subsection b, paragraph one, uses sweeping language: “No requirement or prohibition may be imposed under the laws of any State with respect to any subject matter regulated under” certain provisions of the Act. Congress deliberately used expansive phrases like “no requirement or prohibition,” “with respect to,” and “relating to.” Read together, these show that Congress meant to occupy the field of consumer reporting.

The legislative history supports this interpretation. In the nineteen ninety-six amendments, lawmakers stressed the need for a uniform national credit system. In two thousand three, Congress decided to make preemption permanent, concluding that the national credit reporting system had expanded access to credit, lowered costs, and accelerated decisions. Allowing states to impose their own requirements would fracture the system, increase compliance costs, and undermine the usefulness of credit reports. Consumers would no longer be able to take their credit history with them as they moved, and lenders would struggle to compare creditworthiness across state lines.

The Bureau emphasizes that state laws attempting to regulate core areas of credit reporting—such as prescreening, dispute procedures, adverse action notices, or the content of consumer reports—are preempted. State efforts to ban certain categories of information, such as medical debt or rental arrears, are also preempted. The Bureau explains that rules about how long information may remain on a report and whether it may appear in the first place are points on the same continuum. Allowing states to prohibit categories outright would contradict Congress’s intent.

For the financial services industry, the rule restores clarity. Credit bureaus, lenders, and providers of consumer information can look to federal law as the governing standard without having to reconcile fifty different state regimes. For consumers, the effects are mixed. A national standard supports broader access to credit and ensures consistency. But some advocates will argue that state-level protections, particularly around medical debt, are now off the table.

This interpretive rule is guidance. It does not have the force of law. Courts remain the final arbiters of preemption questions. Still, the Bureau’s position is clear: Congress intended broad federal preemption under the Fair Credit Reporting Act, and the national credit reporting system depends on it.

This concludes the Fair Credit Reporting Act; Preemption of State Laws. If your credit union could use assistance with your exam, reach out to Mark Treichel on LinkedIn, or at Mark Treichel DOT COM. This is Samantha Shares, and we thank you for listening.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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Hello, this is Samantha Shares. This episode covers Frequently Asked Questions.

The following is an audio version of that document. This podcast is educational and is not legal advice. We are sponsored by Credit Union Exam Solutions Incorporated, whose team has over two hundred and forty years of National Credit Union Administration experience. We assist our clients with N C U A so they save time and money. If you are worried about a recent, upcoming or in process N C U A examination, reach out to learn how they can assist at Mark Treichel dot com. Also check out our other podcast called With Flying Colors where we provide tips on how to achieve success with N C U A.

And now the Frequently Asked Questions Regarding Suspicious Activity Reporting Requirements. October 3, 2005.

The Financial Crimes Enforcement Network, jointly with the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the National Credit Union Administration, the Office of the Comptroller of the Currency, and the Office of Thrift Supervision, is issuing interpretive guidance in response to questions received regarding the filing of Suspicious Activity Reports. The purpose of this guidance is to clarify the regulatory expectations and requirements for financial institutions with respect to the reporting of suspicious activity. Financial institutions are reminded that Suspicious Activity Reports are one of the most important sources of information available to law enforcement and regulatory agencies for detecting financial crime, and are used in a wide range of investigations and enforcement actions. Below are answers to frequently asked questions regarding suspicious activity reporting requirements.

Question 1: S A R Filings for Potential Structuring related Activity.

Is a financial institution required to file a S A R for transactions or a series of transactions in which a person or persons are structuring transactions to avoid the C T R threshold, even though the total amount of currency involved does not exceed ten thousand dollars?

Yes. The mere purpose of structuring is evidence of suspicious activity regardless of the amount. If one person or two or more persons act together to break up currency transactions to avoid the ten thousand dollar C T R threshold, then information sufficient to identify the activity should be reported on a S A R. For example, if an individual conducts multiple cash deposits of nine thousand five hundred dollars or less into different accounts to evade a C T R, the financial institution is required to file a S A R.

A financial institution is required to file a S A R for a transaction conducted or attempted by, at, or through the institution if it involves or aggregates at least five thousand dollars in funds or other assets, and the institution knows, suspects, or has reason to suspect that the transaction: One, involves funds derived from illegal activities or is intended to hide or disguise funds from illegal activities. Two, is designed to evade Bank Secrecy Act requirements, such as structuring to avoid a C T R. Three, has no business or apparent lawful purpose.

FinCEN has consistently advised that financial institutions must file S A R s for structuring even when the total amount of currency is less than ten thousand dollars. Under FinCEN guidance, structuring transactions to evade reporting requirements is suspicious in and of itself and must be reported.

Financial institutions should not ignore structuring simply because the total amount falls below the C T R threshold. The fact that the amount is below ten thousand dollars does not eliminate the obligation to file a S A R.

Question 2: Continuing Activity Reviews.

Is a financial institution required to conduct a review of a customer or account following the filing of a S A R to determine whether suspicious activity has continued?

Yes. Recognizing that suspicious conduct does not end once an initial S A R is filed, FinCEN guidance issued in October two thousand advised that institutions must review their S A R filings to determine whether additional S A R s should be filed.

The continuing review should determine whether suspicious activity has persisted and whether further S A R s are warranted. Institutions are required to file continuing activity S A R s no later than ninety days after the date of the previously related S A R filing, if suspicious activity continues.

Financial institutions must establish policies and procedures to identify and report ongoing suspicious activity. Institutions are expected to document reviews conducted and provide the rationale for whether a subsequent S A R is necessary.

Question 3: Continuing Activity Reviews – Timeline.

What is the timeline for a financial institution that elects to file S A R s in accordance with FinCEN’s continuing suspicious activity guidance?

As noted in prior F A Qs, FinCEN previously recommended that financial institutions report continuing suspicious activity with a new S A R filing at least every ninety days. Subsequent S A R s must be filed no later than one hundred and twenty calendar days after the date of the initial S A R.

The standard timeline is: Day one: Date of suspicious activity detection, begin review. Day thirty: File initial S A R. Day ninety: Review whether suspicious activity continues. Day one hundred and twenty: File continuing S A R if necessary.

This timeline ensures that law enforcement is kept informed of continued suspicious activity. Institutions must maintain procedures that identify and escalate potential continuing suspicious conduct to compliance officers responsible for S A R decision-making.

Question 4: No S A R Documentation.

Is a financial institution required to document the decision not to file a S A R?

Yes. There is no requirement or regulation that requires an institution to document its reasons for not filing a S A R. However, FinCEN has stated that financial institutions should maintain sufficient documentation to support the rationale for their decision not to file.

This documentation should be retained in accordance with the institution’s internal policies and record retention requirements, and must be available to examiners and law enforcement upon request.

Outro. This concludes the document.

If your Credit Union could use assistance with your exam, reach out to Mark Treichel on LinkedIn, or at Mark Treichel dot com. This is Samantha Shares and we thank you for listening.

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We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

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Hello, this is Samantha Shares. This episode covers Chairman Hauptman on Regulation by Enforcement.

The following is an audio version of that document. This podcast is educational and is not legal advice. We are sponsored by Credit Union Exam Solutions Incorporated, whose team has over two hundred and forty years of National Credit Union Administration experience. We assist our clients with N C U A so they save time and money. If you are worried about a recent, upcoming or in process N C U A examination, reach out to learn how they can assist at Mark Treichel dot com. Also check out our other podcast called With Flying Colors where we provide tips on how to achieve success with N C U A.

And now the document.

Chairman Hauptman On Regulation by Enforcement

ALEXANDRIA, VA, October 1, 2025 – The National Credit Union Administration Chairman Kyle S. Hauptman issued the following statement about N C U A’s No Regulation-by-Enforcement Policy:

Today’s policy statement fulfills a goal listed back in January upon being designated as Chairman: “Codifying our procedures to protect Americans from regulation-by-enforcement. For example, no enforcement action should ever set―or even clarify― policy. In America and other free societies, the sequence is: set speed limits, then give speeding tickets (no one has any obligation to be aware of someone else’s ticket).”

To be clear, this agency has a good track record regarding regulation-by-enforcement, so this statement shouldn’t be viewed as being the result of any recent N C U A actions. After all, it’s counterproductive for a deposit insurer to engage in regulation-by-enforcement against the same institutions we insure. That said, it’s important to put in writing a policy of fairness, whereby government employees give regulated credit unions the same due-process that they, under civil servant protections, rightly expect in their own careers. Today’s statement is born partly of my frustrating interactions with regulators, both in my time on Capitol Hill and in the private sector. I know that millions of others share the frustration of being told ‘if you want to figure out the rules, look at our prior settlements.’ Americans expect better from their government, including financial regulators.

No Regulation-by-Enforcement Policy Statement

Regulation-by-enforcement is unethical and not permitted at N C U A.

Enforcement actions shall only occur in the case of clear and significant violations of law or regulation. Therefore, no person or entity regulated by N C U A has any obligation to be aware of any prior N C U A enforcement actions because no new policy is ever set via an enforcement action.

No enforcement action, nor the timing of enforcement actions, shall be motivated by trying to boost the agency’s enforcement totals or get the enforcement done in a certain fiscal or calendar year.

Enforcement is a necessary tool, but is not, by itself, an accomplishment or a metric of success. Our goal is for credit unions to operate safely and soundly and in compliance with applicable laws and regulations. We will seek to remedy any such problems whenever we can without needing to use enforcement action. The goal is to resolve any problems, not to issue press releases, rack up enforcement numbers or improve the post-N C U A career options of agency staff. We don’t set “speed traps” to increase enforcement totals.

A guiding principle here is avoiding double-standards. In their own careers, civil servants are protected against arbitrarily poor performance reviews, allegations of misconduct, wrongful termination and other things that could harm their career path. In turn, government employees must extend the same due process protections to those they regulate.

If N C U A finds a harmful practice that threatens our mission or is otherwise injurious or abusive, and it is not currently addressed by law or regulation, then our next step is to consider rulemaking or other remedy. As is the norm in America, the sequence of events at N C U A is: one, publish rules, two, then and only then, enforce them.

This concludes the document.

If your credit union could use assistance with your exam, reach out to Mark Treichel on LinkedIn, or at Mark Treichel dot com. This is Samantha Shares and we thank you for listening.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

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• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

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Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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 N C U A Discontinues Risk Ratings and Reputational Risk

Show Notes
In this episode, Samantha Shares provides an audio version of the recent N C U A communications announcing the discontinuation of risk ratings and the elimination of reputational risk in credit union examinations.

In early September, N C U A emailed CEOs and Board Chairs that it would stop using individual risk ratings for categories like Credit, Liquidity, and Strategic risk. Later that month, the agency issued a press release confirming it would no longer use reputational risk or equivalent concepts, in line with White House Executive Order Fourteen Three Three One.

Listeners will hear the original text of these letters and announcements, voiced audiobook-style, without added commentary. This principle-based guidance is designed to streamline examinations, reduce duplicative scoring, and focus examiner attention on material issues reflected in CAMELS ratings.

Key points covered in the episode include:

• The removal of duplicative risk ratings for the seven traditional risk categories.
• Confirmation that N C U A examiners will still assess risk, but only in the context of CAMELS ratings.
• The elimination of reputational risk as a supervisory concept.
• Clarification that issues such as litigation exposure or insider abuse will still be reviewed under material financial impact.
• An emphasis on more streamlined examination reports and communications with credit unions.

This audiobook-style presentation is intended as an educational resource for credit union leaders and boards.

Disclaimer
This podcast is educational and is not legal advice.

Sponsor Message
Credit Union Exam Solutions Incorporated provides consulting support from a team with more than two hundred and forty years of N C U A experience. If your credit union is preparing for or undergoing an N C U A exam, visit MarkTreichel.com to learn more.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

https://www.linkedin.com/in/mark-treichel/

Tips on Starting an Exam Efficiently

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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Show Notes: OCC Semiannual Risk Perspective Spring 2025

Episode Overview

This episode covers the Office of the Comptroller of the Currency's Semiannual Risk Perspective for Spring 2025, providing valuable insights for credit unions on key banking risks and industry trends.

Key Topics Covered

Federal Banking System Key Themes

• Overall system strength remains sound despite economic uncertainty
• Commercial credit risk increasing due to geopolitical risks and sustained higher interest rates
• Retail credit risk stable but consumer sentiment declining
• Market and liquidity risk stable with improved net interest margins
• Operational risk elevated due to cyber threats and digitalization challenges
• Compliance risk remains elevated

Economic Operating Environment

• Global: Slow growth forecast for 2025, trade policy uncertainty, geopolitical tensions
• Domestic: GDP 12% above pre-pandemic peak, unemployment at 4.2%, but economic uncertainty growing
• Projections: 1.2% growth in 2025, 1.3% in 2026; PCE inflation expected to reach 3.6% by Q3 2025

Credit Risk Insights

Commercial Credit

• CRE market conditions vary by property type
• Office vacancies projected to continue rising into 2026
• Multifamily market expected to stabilize later in 2025
• Refinance risk high for loans underwritten during low-rate periods
• Trade disruptions may compress industry margins

Retail Credit

• Delinquency rates manageable but trending upward
• Consumer payment prioritization favoring low-rate mortgages
• Tighter lending standards across consumer categories
• Natural disaster impacts on insurance and collateral administration

Market Risk

• Net interest margins improved in second half of 2024
• Unrealized investment losses remain a concern
• 10-year Treasury yield volatility affecting portfolio values
• Interest rate risk scenario testing critical given uncertainty

Operational Risk

Cybersecurity

• Continued targeting by threat actors with ransomware
• Increase in "double extortion" attacks
• ATM jackpotting attempts rising
• Third-party dependencies creating single points of failure

Innovation & Technology

• Cautious AI adoption with focus on fraud detection and credit underwriting
• Legacy system challenges amid digitalization demands
• New OCC guidance on crypto-asset activities (IL 1183 and IL 1184)
• Board oversight responsibilities for new technologies

Fraud Risk Management

• Traditional payment methods still targeted
• Social engineering and phishing schemes prevalent
• First-party fraud and insider abuse concerns
• Importance of customer education and staff training

Compliance Risk

BSA/AML and OFAC

• Elevated fraud levels increasing SAR filing obligations
• Fintech partnerships may lack adequate compliance resources
• Corporate Transparency Act requirements removed for US companies
• Need for continued CDD rule compliance

Consumer Compliance

• Investigation and resolution timeframes critical
• New deposit products requiring clear communications
• Rising insurance premiums affecting flood insurance compliance

Bank Performance

• Return on equity stable at 11.7% for federal banking system
• Net interest income growth slowed due to funding costs
• Loan growth weak at 1.6%, driven by C&I loan declines
• Balance sheet positioning may benefit from future rate cuts
• Net charge-off rates historically strong despite slight increases

Key Statistics

• Federal banking system liquid assets: 31% of total assets (vs. 16% in 2008)
• Employment: 5.5 million above pre-pandemic peak
• Unemployment rate: 4.2%
• Q1 2025 job creation: 177,000
• Federal banking system loan growth: 1.6%
• Deposit growth: 1.6%

Important Dates & Regulatory Updates

• March 7, 2025: OCC issued IL 1183 on crypto-asset activities
• May 7, 2025: OCC issued IL 1184 on crypto-asset custody services
• March 2025: Treasury removed beneficial ownership reporting requirements
• September 2024: Federal Reserve began rate cuts (100 basis points total)

Credit Union Applications

While this report focuses on OCC-supervised institutions, the principle-based guidance provides excellent insights for credit unions to:

• Assess similar risk exposures
• Benchmark risk management practices
• Prepare for evolving regulatory expectations
• Understand industry-wide trends affecting the financial sector

Sponsor Information

Credit Union Exam Solutions LLC

• Over 240 years of combined NCUA experience
• Assists credit unions with NCUA examinations
• Contact: Mark Treichel at MarkTreichel.com
• LinkedIn: Mark Treichel

Related Resources

• OCC Bulletin 2017-43: "New, Modified, or Expanded Bank Products and Services"
• OCC Bulletin 2023-17: "Third-Party Relationships: Interagency Guidance"
• OCC Bulletin 2019-37: "Operational Risk: Fraud Risk Management Principles"
• With Flying Colors Podcast: NCUA examination tips and strategies

This podcast is educational and is not legal advice. Content reflects conditions as of December 31, 2024, unless otherwise noted.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

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• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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Show Notes: FDIC Consumer Compliance Supervisory Highlights - July 2025

Episode Summary

In this episode, we break down the FDIC's latest Consumer Compliance Supervisory Highlights report, covering 2024 examination results and compliance trends. While focused on FDIC-supervised institutions, this principle-based guidance serves as an excellent roadmap for credit unions and all financial institutions.

Key Takeaways

Overall Performance

• 97% of FDIC-supervised institutions rated satisfactory or better for consumer compliance
• 800 consumer compliance examinations conducted in 2024
• Risk-focused examination approach targets areas with greatest potential for consumer harm

Top 5 Most Cited Violations (73% of all violations)

1. Truth in Lending Act (TILA) - 470 violations (37%)
   • Periodic statement disclosure failures
   • Good faith estimate timing issues
   • Loan cost breakdown requirements
2. Flood Disaster Protection Act (FDPA) - 143 violations (11%)
   • Failure to provide required flood insurance
   • 45% of FDPA violations related to this single issue
3. Truth in Savings Act (TISA) - 129 violations (10%)
   • Inadequate deposit account disclosures
   • Pre-opening disclosure failures
4. Electronic Fund Transfer Act (EFTA) - 122 violations (10%)
   • Error investigation procedure failures
   • Timing and reporting requirement violations
5. Home Mortgage Disclosure Act (HMDA) - 65 violations (5%)
   • Incomplete data collection and reporting
   • Missing required borrower and loan information

Enforcement Actions & Restitution

• 31 formal and 23 informal enforcement actions
• $5.6 million in civil money penalties
• $33.3 million in voluntary restitution to ~400,000 consumers
• 3 referrals to Department of Justice for discrimination violations

Consumer Complaint Trends

• 26,451 complaints closed (14% increase from 2023)
• 100% acknowledgment within 14 days
• 98.6% response rate within performance goals

Top Complaint Categories:

• Credit cards: 4,733 complaints (29%)
• Checking accounts: 3,152 complaints (19%)
• Installment loans/CLOC: 2,708 complaints (12%)
• Residential real estate: 844 complaints (5%)

Most Common Issues:

• Credit reporting disputes (18%)
• Transaction errors (9%)
• Accounts opened without knowledge (6%)
• Disclosure problems (6%)
• Service availability issues (5%)

Emerging Trends

• 13% increase in third-party provider-related complaints (4,282 cases)
• Growing vendor oversight challenges
• Persistent credit reporting and account opening issues
• Fair lending complaints decreased 9% (68 to 62 cases)

Key Compliance Areas for Focus

High-Risk Areas

• Disclosure Management: TILA, TISA, and HMDA reporting accuracy
• Operational Procedures: Flood insurance, error resolution processes
• Vendor Oversight: Third-party provider compliance monitoring
• Data Collection: HMDA and other regulatory reporting requirements

Proactive Strategies

• Implement robust disclosure review processes
• Enhance staff training on operational compliance
• Strengthen vendor management programs
• Monitor complaint trends as early warning indicators

Why This Matters for Credit Unions

While this report focuses on FDIC-supervised banks, the consumer protection laws and compliance principles apply broadly across financial services. Credit unions can use these insights to:

• Benchmark their compliance performance
• Identify potential risk areas before they become problems
• Enhance training and procedures in high-violation areas
• Improve vendor management practices

Resources Mentioned

• FDIC Consumer Compliance Examination Manual
• Federal Financial Institutions Examination Council (FFIEC) Rating System
• FDIC National Center for Consumer and Depositor Assistance

Host Notes

This episode provides actionable insights for compliance professionals, with extensive use of direct quotes from the FDIC report to ensure accuracy. The data shows that while most institutions are performing well, concentrated issues in specific areas offer clear opportunities for improvement across the industry.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

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• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

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Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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Hello, this is Samantha Shares. This podcast is educational and is not legal advice.

Banking agencies have curtailed issuance of new guidance and regulations under the current administration. As a result, and to continue providing our listeners with valuable new episodes, we're excited to share our new initiative and cohost. We'll be providing AI-powered summaries of evergreen episodes from our sister podcast With Flying Colors. These episodes will highlight the key points in an easy-to-digest eight to twelve minute format.

We continue to embrace Artificial Intelligence, and like my voice, these new episodes will be introduced by me and then narrated by our guest AI voice. Today, Daniel will discuss 'NCUA Exam Alert: Risk Management Framework Essentials That Pass Exams.' This episode is also available on YouTube in AI video format, so be sure to check that out as well!

Now, here's Daniel with your summary.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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https://www.linkedin.com/in/mark-treichel/

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

https://www.linkedin.com/in/mark-treichel/

Episode: Fighting Payments Fraud - Federal Banking Agencies Launch Major Initiative

Episode Summary

Three major federal banking agencies have joined forces to combat the explosive growth in payments fraud across America. In this episode, we break down the comprehensive Request for Information issued by the OCC, Federal Reserve, and FDIC on June 20, 2025, seeking public input on how to better protect consumers, businesses, and financial institutions from fraud schemes.

Key Takeaways

🚨 Alarming Statistics:

• Non-card payments fraud losses increased 271% between 2020-2024
• Suspicious Activity Reports for check, ACH, and wire fraud up 489% since 2014
• Check fraud alone has risen 385% since COVID-19
• Check fraud accounts for 30% of all fraud-related SARs filed in 2023

💰 Financial Impact:

• Fraud reports for payments apps, bank transfers, wire transfers, and checks resulted in $2.99 billion in losses in 2024, up from $806 million in 2020

Five Key Areas Federal Agencies Are Targeting

1. External Collaboration - How can stakeholders work together more effectively?
2. Education - Better fraud prevention education for consumers, businesses, and industry
3. Regulation & Supervision - Potential regulatory changes and clearer guidance
4. Data Collection - Standardizing and centralizing fraud data sharing
5. Reserve Bank Tools - Enhanced fraud detection and prevention services

Notable Quotes

What's at Stake

• Check Vulnerability: Paper checks contain sensitive information including account numbers, routing numbers, addresses, and signatures that criminals can exploit
• Multi-Institution Schemes: Fraud often involves multiple banks and payment methods across different regulatory jurisdictions
• Trust in the System: Continued fraud growth threatens confidence in the entire U.S. payments infrastructure

Regulatory Focus Areas

Regulation CC Changes

The Federal Reserve is considering amendments to funds availability rules, asking whether:

• Technological advances allow for shorter hold periods
• Current fraud detection capabilities justify faster fund access
• Better dispute resolution mechanisms are needed

Industry Pain Points

• Banks struggle with interbank disputes over fraudulent check liability
• Small community banks need additional fraud prevention resources
• Current data sharing restrictions limit collaborative fraud fighting

What Happens Next

Comment Deadline: September 18, 2025

Who Can Participate:

• Banks and credit unions
• Fintech companies
• Consumer advocacy groups
• Technology providers
• Payment processors
• Anyone affected by payments fraud

Questions Agencies Want Answered

• What technological solutions work best for fraud prevention?
• How can fraud education be more effective?
• Should Reserve Banks require fraud reporting across all payment rails?
• What barriers prevent better data sharing between institutions?
• How can confirmation of payee services reduce fraud?

Why This Matters to You

Whether you're a banking professional, fintech entrepreneur, or consumer who's experienced fraud, this initiative could reshape how America fights payments fraud. The agencies are serious about getting input from all stakeholders to build a more secure payments ecosystem.

Resources

• Federal Register Document: Vol. 90, No. 117, June 20, 2025, pages 26293-26298
• Comment Submission: Multiple agencies accept comments through regulations.gov and agency websites
• Agency Contacts: Specialized fraud and payments policy teams at OCC, Federal Reserve, and FDIC

Episode Length

Approximately 10 minutes

Tags

#PaymentsFraud #BankingRegulation #FederalReserve #OCC #FDIC #CheckFraud #Fintech #PaymentSecurity #RegulatoryPolicy #FinancialCrimes

This episode is based on official federal regulatory documents. For the most current information, consult the Federal Register and agency websites.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

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Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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https://www.linkedin.com/in/mark-treichel/

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

https://www.linkedin.com/in/mark-treichel/

https://www.linkedin.com/in/mark-treichel/

www.marktreichel.com

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

https://www.linkedin.com/in/mark-treichel/

www.marktreichel.com

https://www.linkedin.com/in/mark-treichel/

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

https://www.linkedin.com/in/mark-treichel/

Enforcement actions range from formal to informal, and minor to drastic.  Today we discuss what NCUA's philosophy is in this regard.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

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• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

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Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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The Federal Credit Union Act allows NCUA to remove officials.  We explain how.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

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• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

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Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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https://ncua.gov/regulation-supervision/letters-credit-unions-other-guidance/enterprise-risk-management-erm

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

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• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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The National Credit Union Administration (NCUA) today liquidated Unilever Federal Credit Union of Englewood Cliffs, New Jersey. The NCUA made the decision to liquidate Unilever Federal Credit Union and discontinue operations after determining the credit union was insolvent and had no prospect for restoring viable operations.

Member deposits are federally insured by the National Credit Union Share Insurance Fund to at least $250,000. NCUA’s Asset Management and Assistance Center will issue correspondence to individuals holding verified share accounts in the credit union within one week. Members may direct questions and other inquiries concerning their accounts to NCUA’s Asset Management and Assistance Center:

Unilever Federal Credit Union
c/o National Credit Union Administration
10910 Domain Dr., Suite 200
Austin, Texas 78758
1.877.715.0777 or 512.231.7940
amacmail@ncua.gov

Members with additional questions about their insurance coverage may contact NCUA’s Consumer Assistance Center toll free at 800.755.1030. The Center answers calls Monday–Friday between 8 a.m. and 5 p.m. Eastern. Individuals may also visit the MyCreditUnion.gov
(Opens new window) website at any time for more information about their insurance coverage.

Unilever Federal Credit Union served 1,448 members and had assets of $46,669,599, according to the credit union’s most recent Call Report. Chartered in 1948, Unilever Federal Credit Union primarily served employees of UNUS, Unilever United States, Inc, and its directly or indirectly wholly owned subsidiaries who work in or are paid from Englewood Cliffs, New Jersey.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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Hello, this is Samantha Shares. This episode covers NCUA’s reopening the public comment period on two recently finalized rules that haven’t fully taken effect yet.

This podcast is educational and is not legal advice.  We are sponsored by Credit Union Exam Solutions Incorporated, whose team has over two hundred and Forty years of National Credit Union  Administration experience.  We assist our clients with N C U A so they save time and money.  If you are worried about a recent, upcoming or in process N C U A examination, reach out to learn how they can assist at Mark Treichel DOT COM.  Also check out our other podcast called With Flying Colors where we provide tips on how to achieve success with N C U A.

Today, we’re diving into an important update from the National Credit Union Administration. This update comes straight from the April twenty-third Federal Register. If you’re a board member, executive, or compliance officer, you’ll want to pay close attention.

On April twenty-third, the NCUA announced something a little unusual—they are reopening the public comment period on two recently finalized rules that haven’t fully taken effect yet. Here’s why this matters.

Earlier this year, the White House issued what’s called a “Regulatory Freeze Pending Review.” In plain English, that means federal agencies were asked to hit pause and review any major new rules that hadn’t already kicked in. NCUA, just like other agencies, is now inviting the public—yes, that means you—to weigh in again on two big rules.

The first is called Simplification of Share Insurance. This rule was finalized back in September twenty twenty-four and is scheduled to fully take effect December first, twenty twenty-six. The goal is to make NCUA’s share insurance rules simpler and clearer for both credit unions and your members. With this new comment window, you have another chance to raise questions, flag concerns, or support the parts of the rule you think are working.

The second rule is about Succession Planning. This one was finalized in December twenty twenty-four and is set to take effect January first, twenty twenty-six. It’s designed to make sure credit unions have solid plans in place for leadership succession—a big deal, especially for smaller credit unions and those with retiring executives. This new comment period is your opportunity to share whether you think the rule strikes the right balance, or if it creates any challenges for your operations.

So how can you submit your comments? You have until June twenty-third, twenty twenty-five. You can go online to regulations dot gov and look up the docket numbers for each rule, or send your comments to the NCUA Secretary in Alexandria, Virginia. If you’re old school, you can even hand deliver them.

You might be thinking, didn’t we already comment on these rules? Yes, many did—but this is a second bite at the apple, thanks to the new administration’s regulatory review. If your credit union has operational concerns, needs more clarity, or has suggestions for how the rules are implemented, now is your chance to be heard.

Here are your quick takeaways. NCUA is actively seeking comments on the share insurance simplification and succession planning rules, both of which are set to take effect in twenty twenty-six. The deadline for comments is June twenty-third, twenty twenty-five. Your feedback could help shape how these rules roll out, or even whether they proceed as planned.

That’s it for today’s update. We’ll keep you posted on any new developments and what they mean for your credit union. If you have questions or want to share how your credit union is preparing for these changes, send us a note—we might feature your insights in a future episode.

Thanks for tuning in  Stay informed, stay compliant, and stay ahead.

If your Credit union could use assistance with your exam, reach out to Mark Treichel on LinkedIn, or at mark Treichel dot com.  This is Samantha Shares and we Thank you for listening.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

https://www.linkedin.com/in/mark-treichel/

 NCUA Releases Staff Message on the Current NCUA Board

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

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• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

https://www.linkedin.com/in/mark-treichel/

Understanding Conflicts of Interest in Asset Management: Show Notes

In this episode, Samantha Shares explores the critical topic of conflicts of interest in asset management based on the OCC Comptroller's Handbook. While originally created for banks, these principle-based guidelines provide an excellent framework for credit unions managing conflicts in their asset management activities. The episode covers what constitutes a conflict of interest, common scenarios where conflicts arise, the four main risk categories (compliance, operational, reputation, and strategic), and key components of effective risk management. Samantha details specific conflict situations including self-deposits, proprietary investment products, brokerage allocation, and soft dollar arrangements, while outlining four essential principles for handling conflicts: proper authorization, full disclosure, fairness and reasonableness, and maintaining the client's best interest. The episode emphasizes that managing conflicts effectively isn't just about regulatory compliance—it's fundamental to maintaining client trust and protecting your institution's reputation.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

https://www.linkedin.com/in/mark-treichel/

Show Notes: Model Risk Management (OCC Comptroller's Handbook) 

In this episode, Samantha Shares discusses the OCC's "Model Risk Management" handbook (Version 1.0, August 2021). This comprehensive handbook provides guidance on how financial institutions should manage risks associated with their use of models. 

Key topics covered: 

• Definition of models and model risk
• Types of risk associated with model use
• Governance framework requirements
• Three lines of defense in model risk management
• Model development, testing and implementation
• Validation process and requirements
• Third-party model risk management
• Documentation and inventory requirements

This handbook is essential knowledge for anyone dealing with model risk management in financial institutions, particularly those subject to OCC supervision.
 

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

https://www.linkedin.com/in/mark-treichel/

Reach out to learn how we assist our clients.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

https://www.linkedin.com/in/mark-treichel/

NCUA wants you to build a good contingency funding plan.  We discuss their guidance on this important topic.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

https://www.linkedin.com/in/mark-treichel/

Hello, this is Samantha Shares. This episode covers NCUA Board Member Tanya Otsuka Statement on the Decision to Remove Total Overdraft and Non-sufficient Fund Fee Data

The following is an audio version of that STATEMENT.    This podcast is educational and is not legal advice.  We are sponsored by Credit Union Exam Solutions Incorporated, whose team has over two hundred and Forty years of National Credit Union  Administration experience.  We assist our clients with N C U A so they save time and money.  If you are worried about a recent, upcoming or in process N C U A examination, reach out to learn how they can assist at Mark Treichel DOT COM.  Also check out our other podcast called With Flying Colors where we provide tips on how to achieve success with N C U A.

And now the STATEMENT

N C U A Board Member Tanya Otsuka Statement on the Decision to Remove Total Overdraft and Non-sufficient Fund Fee Data

N C U A Board Member Tanya F. Otsuka issued the following statement about the agency’s decision to remove total overdraft and non-sufficient fund (NSF) fee data for federally insured credit unions with more than $1 billion in assets from Call Reports beginning with the first quarter of 2025.

Member empowerment is a cornerstone of the cooperative credit movement. For credit unions, which are built on the philosophy of “people helping people,” increasing transparency is a simple way to demonstrate the credit union difference, enable consumers to make informed financial decisions, and help maintain trust and confidence in our cooperative system of credit. In that spirit, the N C U A began collecting and publishing quarterly Call Report data on revenues credit unions with over $1 billion in assets made from overdraft and non-sufficient funds (NSF) fees last year.

Unfortunately, the fourth quarter 2024 data published today will be the last to include information on overdraft and NSF fee income. On March 3, 2025, Chairman Hauptman unilaterally announced changes to the way the N C U A collects overdraft and NSF fee information.1 Specifically, starting on March 31, 2025, the agency would “no longer publish overdraft and non-sufficient fund fee income for individual credit unions” and this information would ostensibly be collected during supervisory examinations.

This is a step in the wrong direction. There is no data to suggest credit unions limited the services they provide low-income or underserved consumers last year simply to avoid having to report fee income on the N C U A’s Call Reports. Credit unions with higher overdraft and NSF fees also do not appear to offer lower fees to members for other services, nor better interest rates.2 Overdraft and NSF fees put a strain on members who are likely already struggling and may further trap them in a cycle of financial hardship that can be difficult to escape. That is why providing the public information about fees through the N C U A’s Call Reports enabled consumers across the country to more readily compare between credit unions and choose the institution that best fit their needs.3

Credit unions are already required to disclose to their members the fees that they charge. Instead of providing overdraft and fee income in a transparent, consistent, and standardized way, collecting overdraft and NSF fee data through the exam process will erode the quality of the data and hamstring our ability to monitor trends. The decision to collect this data through the supervisory process rather than through the quarterly Call Report must not be used as an excuse to withhold it from credit union members or the broader public.

Transparency is vital for promoting fair competition within the financial system. Limiting access to individual credit union data does not help consumers, encourage the chartering of de novo institutions, or reduce regulatory burden on small cooperatives, which were exempt from the requirement to report these data. It just enables larger institutions that rely heavily on fee income to operate in the shadows, resulting in less competition and less choice for consumers, and places institutions that stay true to the principles of the credit union movement at a disadvantage.

At the end of the day, members, as owners of their credit union, have a right to know how their institution operates, just like any investor would if they purchased stock in a publicly traded company. We shouldn’t keep credit union members in the dark.

I urge the N C U A Chair to prioritize transparency and to continue the practice of quarterly reporting and public disclosure of overdraft and NSF fee income for individual credit unions. I look forward to continuing to work with the entire N C U A Board to protect consumers and the credit union system.

This concludes the STATEMENT

If your Credit union could use assistance with your exam, reach out to Mark Treichel on LinkedIn, or at mark Treichel dot com.  This is Samantha Shares and we Thank you for listening.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

https://www.linkedin.com/in/mark-treichel/

Hello, this is Samantha Shares. This episode covers NCUA Board Member Todd Harper Statement on the Decision to Curtail the Collection of Overdraft and Non-sufficient Fund Fees

The following is an audio version of that Statement     This podcast is educational and is not legal advice.  We are sponsored by Credit Union Exam Solutions Incorporated, whose team has over two hundred and Forty years of National Credit Union  Administration experience.  We assist our clients with N C U A so they save time and money.  If you are worried about a recent, upcoming or in process N C U A examination, reach out to learn how they can assist at Mark Treichel DOT COM.  Also check out our other podcast called With Flying Colors where we provide tips on how to achieve success with N C U A.

And now the Statement.

NCUA Board Member Todd Harper issued the following statement about the agency’s decision to curtail the collection of total overdraft and non-sufficient fund (NSF) fees for federally insured credit unions with more than $1 billion in assets beginning with Call Reports for the first quarter of 2025.

For markets to work efficiently, transparency is needed. That’s a bedrock principle of economics. And, it’s one of the many reasons why credit union member-owners and the public should have clear visibility into the income a credit union generates from overdraft and NSF fees charged to its member-owners.

To advance credit union efforts to benchmark fees against other financial institutions, improve marketplace competition, and increase consumer understanding of the fees they’re charged within the credit union system, the NCUA required federally insured credit unions with more than $1 billion in assets to disclose, separately, income from overdraft and NSF fees beginning with the 2024 first quarter Call Report. With today’s release of the 2024 fourth quarter Call Report results, however, that desirable transparency experiment will regrettably end.

During the last year, we’ve found that reporting institutions have collected $3.8 billion in such fees. Some charged no fees at all. For most reporting credit unions, overdraft and NSF fees accounted for between 2 and 5 percent of revenue. Some outliers charged fees amounting to as much as 18 percent of income. For those billion-dollar-plus credit unions with higher overdraft and NSF fees, we also found that they did not use those fees to subsidize better interest rates or lower other fees.

Federally insured banks with more than $1 billion in assets began reporting these numbers in 2015. Since then, consumers have benefitted as banks have lowered their reliance on such fees. In fact, the Consumer Financial Protection Bureau found that roughly two out of three banks with $10 billion or more in assets have eliminated NSF fees, saving consumers $2 billion annually. Yet, among credit unions with greater than $10 billion in assets, four out of five continue to charge NSF fees. That overreliance on such fees is one of the many reasons why the NCUA began collecting and publicly reporting this data on Call Reports.

But, by unilateral action by the Chairman, credit union member-owners and the public will now no longer have access to this important information. If credit unions are to live up to their statutory purpose of supporting the financial needs of ‘people of modest means and the credit union movement’s oft-touted ‘people-helping-people’ philosophy, then credit union member-owners should have access to this basic market information, so they can make better decisions about how and where to deposit and access their hard-earned money.

While the NCUA will no longer publish overdraft and NSF fee income for individual credit unions on a real-time quarterly basis, the agency will instead collect the data during supervisory examinations. This approach, however, will likely shield credit union members from accessing the information through the Freedom of Information Act. Ultimately, this non-disclosure will result in financial exclusion, especially when one considers that NSF is a fee for not paying for an item.

In my view, the NCUA should restore fee transparency for overdraft and NSF fees on Call Reports. If the Chairman is unwilling to reverse course, then the overdraft and NSF fee data collected in the exam process at individual credit unions shouldn’t be shielded from public release through the Freedom of Information Act. If such data was once already public information, why now sweep it under the rug?

The Chairman also noted that the appropriateness of overdrafts and NSF fees charged is a matter between a credit union and its member-owners. If those member-owners ultimately determine how their credit union is run, then credit union management should make their overdraft and NSF income upon member-owner request.

As a steward of the credit union system and someone whose father and grandfather started credit unions, I strongly believe in the concept of a credit union movement to lift up everyone. But, this unnecessary decision moves that credit union movement closer to an industry, one that’s worse than banks when it comes to fee disclosures. Profiting from consumers’ problems will come back and bite you. America’s credit union member-owners deserve better.

This concludes the statement.

If your Credit union could use assistance with your exam, reach out to Mark Treichel on LinkedIn, or at mark Treichel dot com.  This is Samantha Shares and we Thank you for listening

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

https://www.linkedin.com/in/mark-treichel/

NCUA Board Member Tanya F. Otsuka Remarks at the 2025 Governmental Affairs Conference

As Prepared for Delivery on March 4, 2025

Thank you to Jim, Carrie, and everyone at America’s Credit Unions for the invitation. Special thanks to the convention center staff and everyone behind the scenes who helped put this event together and are making sure it runs smoothly. And of course, thank you all in the audience for being here.

It is an honor to serve on the Board of the NCUA and to see the great work credit unions are doing for their members every day. The NCUA’s mission of protecting the cooperative credit system is imperative for the millions of families that rely on credit unions for a checking account, buy a car or a home, or save for retirement.

Congress has entrusted the NCUA with the responsibility to protect credit union members and the credit union system, and our ability to do so depends on a strong, independent agency, with dedicated staff who understand the unique role that credit unions play in our economy.

Our independence is critical to maintaining confidence and stability in the credit union system. If you put your money in a credit union with the words “insured by the NCUA” emblazoned on the door, you can trust that you won’t lose your life savings if that credit union fails. Share insurance creates confidence in the credit union system, which not only protects Americans’ hard-earned money, but also helps credit unions attract new members and continue to grow.

"Congress has entrusted the NCUA with the responsibility to protect credit union members and the credit union system, and our ability to do so depends on a strong, independent agency, with dedicated staff who understand the unique role that credit unions play in our economy. Our independence is critical to maintaining confidence and stability in the credit union system."

As the primary federal regulator of credit unions, the NCUA understands the unique characteristics of credit unions and their members. Our independence from politics and distinction from other financial regulators allows us to focus on what matters to the credit union system. It also allows us to maintain long-term stability, mitigate risks and act quickly during a crisis, and prudently manage the share insurance fund.

We must not lose sight of why these guardrails are in place. The NCUA, as we know it today, is the product of one too many dark periods in our nation’s history. During the Great Depression, the stock market crashed, our economy collapsed, and thousands of banks failed, wiping out many Americans’ entire life savings. In response, Congress created independent financial agencies and consumer protections – like deposit insurance – to promote stability and provide a safety net for American families. Congress also encouraged the creation of federal credit unions under the Federal Credit Union Act of 1934, allowing more people of modest means to access affordable credit, secure their savings, and ultimately begin to recover from financial hardship. The credit union movement continued to grow, and in 1970, Congress established the NCUA as an independent agency to charter and supervise federal credit unions and manage the Share Insurance Fund, which extended the deposit insurance safety net to credit union members.

Fast-forward to the 2008 Financial Crisis, when years of deregulation and lax oversight paved the way for risky and unethical financial practices on Wall Street to wreak havoc on our economy. As financial institutions failed, markets crashed, and businesses shuttered, everyday Americans were left holding the bag. Millions of families lost their homes. While credit unions fared better than banks overall, credit unions were not spared. Between 2008 and 2012, the NCUA oversaw over 130 involuntary liquidations and mergers. To create a more resilient financial system, Congress passed the Dodd-Frank Act, which put in place higher standards for the largest banks and financial companies, established stronger consumer protections, and increased the maximum share insurance for credit union members.

"That is why credit unions must continue to show the American people what the credit union difference means and live up to the mantra of 'people helping people.' . . . Too much is at stake to be seen as no different than a bank or a tech company or any other financial institution. The credit union difference is the ultimate competitive advantage."

It is no coincidence that credit unions were not the catalyst for our past financial crises. That is a reflection of the credit union ethos. From its inception, the credit union movement has sought to advance access for all and prioritize the economic interests of its members. Credit unions are an integral part of our financial system, serving over 142 million consumers across the United States. Credit unions are often a lifeline for the communities they support. And for many Americans, they are the only source of access to affordable and equitable financial products and services.

That is why credit unions must continue to show the American people what the credit union difference means and live up to the mantra of “people helping people.” As not-for-profit, mission-driven institutions, credit unions must embrace the importance of strong consumer protection, lower cost financial products, and service over profit. Too much is at stake to be seen as no different than a bank or a tech company or any other financial institution. The credit union difference is the ultimate competitive advantage.

Over the past year, I have focused on small credit unions and promoting and preserving minority depository institutions, and we have made sure that credit unions who have expanded to underserved areas are meeting the needs of those communities. There is much more we would like to achieve, including dedicating more time and staff to support smaller credit unions and looking at proposing a new rule to reimburse credit union board members for childcare and dependent expenses. To accomplish our shared goals, we need an independent regulator designed to regulate credit unions. That is the NCUA.

The NCUA is critical to protecting the millions of members who rely on us to safeguard their hard-earned money. By focusing on our mission, we can ensure credit unions are well positioned for the future and able to meet their members’ financial needs in good times and bad. Ultimately, our society benefits from a healthy credit union system that provides access to affordable financial services to those of modest means. Protecting that system is central to why we are all here today. I hope we never forget that. Thank you.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

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• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

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Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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This episode covers NCUA's Guidance to Credit Unions on Concentration Risk.

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• Continuous access to our extensive subject matter expertise

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Hello, this is Samantha Shares. This episode covers NCUA Chairman Kyle S. Hauptman's opening remarks from the February 27, 2025 Board Meeting.

The following is an audio version of Chairman Hauptman's first board meeting remarks as NCUA Chairman. This podcast is educational and is not legal advice. We are sponsored by Credit Union Exam Solutions Incorporated, whose team has over two hundred and forty years of National Credit Union Administration experience. We assist our clients with NCUA so they save time and money. If you are worried about a recent, upcoming or in process NCUA examination, reach out to learn how they can assist at MarkTreichel.com. Also check out our other podcast called With Flying Colors where we provide tips on how to achieve success with NCUA.

And now the Chairman's opening remarks.

NCUA Chairman Kyle S. Hauptman Board Meeting Opening Remarks

As Prepared for Delivery on February 27, 2025

This is my first board meeting as Chairman. It's truly an honor to serve as the thirteenth Chairman of the NCUA and advance priorities that promote growth, opportunity, and innovation within the credit union system. I want to thank the President for his trust in me, and I also want to thank Todd Harper for his service through some challenging times for NCUA and the credit union system.

Over the past few weeks there has been various announcements and Executive Orders affecting the federal workforce. Some of these directives may bring significant changes to the NCUA.

All of us at this table understand that change, and the uncertainty that accompanies it, can be challenging for a number of parties: the credit union system, other stakeholders, and most definitely NCUA employees. All of us at the NCUA, including the Board, are diligently assessing how these announcements may affect the NCUA, our operations, regulatory structures, and our workforce.

"All of us at this table understand that change, and the uncertainty that accompanies it, can be challenging for a number of parties: the credit union system, other stakeholders, and most definitely NCUA employees."

To the NCUA employees who may be watching: The work each of you does, day in and day out, keeps our credit union system thriving and credit union members safe. There's also loads of misinformation and rumor out there. I've spent some time recently reading forums on Reddit that touch on NCUA or federal employees. And there's some crazy stuff out there. People moving money out of banks and credit unions to buy Treasury bonds because they think deposit insurance is going away. And that's not one of the crazier ones.

Let's continue to stay focused on our mission, and we --- the Board --- will continue to support your work as we navigate any changes together. Thank you for your patience and your dedication to the NCUA.

One thing that struck me last week. Our executive director mentioned how much NCUA staff liked seeing an email about this year's fee schedule for credit unions. I was curious why a fairly routine, mundane topic would generate a positive reaction. But it was precisely because it was mundane that people reacted that way. A sign that the big picture hasn't changed, NCUA business continues.

I want to ask of my 1200 colleagues at NCUA to reach out to me anytime, by phone, Teams, email. While we on the Board don't have any more info on White House directives than anyone else, I'm happy to talk about problems and possible solutions. I'll tell you what I know and don't know.

And to the people who we work for, the 142 million Americans who pay into the Share Insurance Fund: Know that NCUA's mission is unchanged. There are 4500 credit unions to examine, and most importantly, a $22 billion Share Insurance Fund that is the true north for each of us on the Board. Our deposit insurance is unchanged, the exams are continuing just the rest of our work here. Be assured we haven't taken our eye off the ball.

"There are 4500 credit unions to examine, and most importantly, a $22 billion Share Insurance Fund that is the true north for each of us on the Board."

We're aware that uncertainty surrounding your employer and your job isn't new for credit union members. Many credit unions were founded by employee groups of companies that no longer exist. We're aware that most Americans, the people who pay my salary, live a daily reality of uncertainty to their work situation. Just four years ago, 21 million Americans lost their jobs in one month. We get how the real world works. So just maybe grant us a bit of grace as we adjust and work through changes. And again, your money is safe in the NCUA insurance fund, and it's safe at NCUA-insured credit unions. Our NCUA staff are professionals, and they, and credit union members, should know the management around here has worked around the clock to ensure we still meet the needs of America's credit union members and my outstanding NCUA coworkers.

And finally, I know that as Chairman, I can steer some priorities of the agency, but any concrete actions will require Board approval and that requires some measure of compromise on the part of all parties. Discussions among my colleagues have always been in good faith and in the spirit of cooperation during my tenure on the Board. There has been plenty of give-and-take in negotiations. None of us gets everything he or she wants, but all of us get some of what we wanted. I look forward to continuing that collaboration with my Board colleagues now that I am Chairman.

That concludes my opening remarks.

This concludes Chairman Hauptman's opening remarks from his first board meeting as NCUA Chairman.

If your credit union could use assistance with your exam during these times of change at the NCUA, or if you have concerns about how recent executive orders might impact your credit union's examination process, reach out to Mark Treichel on LinkedIn, or at MarkTreichel.com. This is Samantha Shares and we thank you for listening.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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By the authority vested in me as President by the Constitution and the laws of the United States of America, it is hereby ordered:  

     Section 1.  Policy and Purpose.  The Constitution vests all executive power in the President and charges him with faithfully executing the laws.  Since it would be impossible for the President to single-handedly perform all the executive business of the Federal Government, the Constitution also provides for subordinate officers to assist the President in his executive duties.  In the exercise of their often-considerable authority, these executive branch officials remain subject to the President’s ongoing supervision and control.  The President in turn is regularly elected by and accountable to the American people.  This is one of the structural safeguards, along with the separation of powers between the executive and legislative branches, regular elections for the Congress, and an independent judiciary whose judges are appointed by the President by and with the advice and consent of the Senate, by which the Framers created a Government accountable to the American people.  

     However, previous administrations have allowed so-called “independent regulatory agencies” to operate with minimal Presidential supervision.  These regulatory agencies currently exercise substantial executive authority without sufficient accountability to the President, and through him, to the American people.  Moreover, these regulatory agencies have been permitted to promulgate significant regulations without review by the President.  

     These practices undermine such regulatory agencies’ accountability to the American people and prevent a unified and coherent execution of Federal law.  For the Federal Government to be truly accountable to the American people, officials who wield vast executive power must be supervised and controlled by the people’s elected President.  

     Therefore, in order to improve the administration of the executive branch and to increase regulatory officials’ accountability to the American people, it shall be the policy of the executive branch to ensure Presidential supervision and control of the entire executive branch.  Moreover, all executive departments and agencies, including so-called independent agencies, shall submit for review all proposed and final significant regulatory actions to the Office of Information and Regulatory Affairs (OIRA) within the Executive Office of the President before publication in the Federal Register. 

     Sec. 2.  Definitions.  For the purposes of this order:

     (a)  The term “employees” shall have the meaning given that term in section 2105 of title 5, United States Code.  

     (b)  The term “independent regulatory agency” shall have the meaning given that term in section 3502(5) of title 44, United States Code.  This order shall not apply to the Board of Governors of the Federal Reserve System or to the Federal Open Market Committee in its conduct of monetary policy.  This order shall apply to the Board of Governors of the Federal Reserve System only in connection with its conduct and authorities directly related to its supervision and regulation of financial institutions.  

     (c)  The term “independent regulatory agency chairman” shall mean, with regard to a multi-member independent regulatory agency, the chairman of such agency, and shall mean, with regard to a single-headed independent regulatory agency, such agency’s chairman, director, or other presiding officer.  

     (d)  The term “head” of an independent regulatory agency shall mean those appointed to supervise independent regulatory agencies and in whom the agencies’ authorities are generally vested, encompassing the chairman, director, or other presiding officer, and, as applicable, other members, commissioners, or similar such officials with responsibility for supervising such agencies.  

     Sec. 3.  OIRA Review of Agency Regulations.  (a)  Section 3(b) of Executive Order 12866 of September 30, 1993 (“Regulatory Planning and Review”), as amended, is hereby amended to read as follows:  

     “(b)  “Agency,” unless otherwise indicated, means any authority of the United States that is an “agency” under 44 U.S.C. 3502(1), and shall also include the Federal Election Commission.  This order shall not apply to the Board of Governors of the Federal Reserve System or to the Federal Open Market Committee in its conduct of monetary policy.  This order shall apply to the Board of Governors of the Federal Reserve System only in connection with its conduct and authorities directly related to its supervision and regulation of financial institutions.”.

     (b)  The Director of the Office of Management and Budget (OMB) shall provide guidance on implementation of this order to the heads of executive departments and agencies newly submitting regulatory actions under section 3(b) of Executive Order 12866.  Agency submissions by independent regulatory agencies under such section shall commence within the earlier of 60 days from the date of this order, or completion of such implementation guidance.  

     Sec. 4.  Performance Standards and Management Objectives.  The Director of OMB shall establish performance standards and management objectives for independent agency heads, as appropriate and consistent with applicable law, and report periodically to the President on their performance and efficiency in attaining such standards and objectives. 

     Sec. 5.  Apportionments for Independent Regulatory Agencies.  The Director of OMB shall, on an ongoing basis:  

     (a)  review independent regulatory agencies’ obligations for consistency with the President’s policies and priorities; and  

     (b)  consult with independent regulatory agency chairmen and adjust such agencies’ apportionments by activity, function, project, or object, as necessary and appropriate, to advance the President’s policies and priorities.  Such adjustments to apportionments may prohibit independent regulatory agencies from expending appropriations on particular activities, functions, projects, or objects, so long as such restrictions are consistent with law. 

     Sec. 6.  Additional Consultation with the Executive Office of the President.  (a)  Subject to subsection (b), independent regulatory agency chairmen shall regularly consult with and coordinate policies and priorities with the directors of OMB, the White House Domestic Policy Council, and the White House National Economic Council. 

     (b)  The heads of independent regulatory agencies shall establish a position of White House Liaison in their respective agencies.  Such position shall be in grade 15 of the General Schedule and shall be placed in Schedule C of the excepted service. 

     (c)  Independent regulatory agency chairmen shall submit agency strategic plans developed pursuant to the Government Performance and Results Act of 1993 to the Director of OMB for clearance prior to finalization. 

      Sec. 7.  Rules of Conduct Guiding Federal Employees’ Interpretation of the Law. The President and the Atto...

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This episode covers NCUA's Guidance to Examiners on how they should evaluate credit union earnings.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

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• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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NCUA's Supervisory Letter on Enterprise Risk Management.  Audiobook style.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

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• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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## Episode Overview
This episode covers the OCC's Fall 2024 Operational Risk report, examining key areas of focus for financial institutions including cybersecurity, operational resilience, innovation, and fraud risk management.

## Key Topics Covered

### Cybersecurity
- Elevated operational risks due to evolving cyber threats and AI technology
- Importance of third-party risk management in the expanding cyber threat landscape
- Critical security measures including MFA, system hardening, and patch management
- New post-quantum computing encryption standards from NIST

### Operational Resilience
- Focus on mitigating disruption events and cyber incidents
- Case study from mid-2024 involving global disruptions from flawed software updates
- Importance of testing and validating resilience plans

### Innovation and New Services
- Banks' adoption of new technologies and fintech partnerships
- Cautious approach to AI and machine learning implementation
- Considerations for digital asset custody and cryptocurrency services
- Challenges of maintaining legacy systems while pursuing digitization

### Fraud Risk Management
- Evolution of fraud prevention strategies
- Importance of customer identification and verification
- Implementation of transaction verification and authentication controls
- Role of technology in flagging suspicious activity

### Third-Party Risk Management
- Continuous lifecycle approach to third-party relationships
- Risk management processes scaled to bank size and complexity
- Importance of ongoing monitoring as relationships evolve

## Resources Mentioned
- Credit Union Exam Solutions Incorporated
- Mark Treichel's Website: marktreichel.com
- "With Flying Colors" Podcast

## Contact Information
- LinkedIn: Mark Treichel
- Website: marktreichel.com

## Disclaimer
This podcast is educational and does not constitute legal advice. All opinions expressed are for informational purposes only.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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The full OCC report can be found HERE

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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https://ncua.gov/regulation-supervision/letters-credit-unions-other-guidance/evaluating-third-party-relationships-0

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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Hello, this is Samantha Shares. This episode covers N C U A’s Authority to issue cease and desist orders as outlined in its enforcement manual.

The following is an audio version of that portion of the manual.    This podcast is educational and is not legal advice.  We are sponsored by Credit Union Exam Solutions Incorporated, whose team has over two hundred and Forty years of National Credit Union  Administration experience.  We assist our clients with N C U A so they save time and money.  If you are worried about a recent, upcoming or in process N C U A examination, reach out to learn how they can assist at Mark Treichel DOT COM.  Also check out our other podcast called With Flying Colors where we provide tips on how to achieve success with N C U A.

And now cease and desist orders.

Cease and Desist Order 

1.    What is a Cease and Desist Order?

A Cease and Desist (C AND D) Order normally requires the credit union to stop illegal or unsafe or unsound activities which caused or is likely to cause more than a minimal financial loss to, or have a significant adverse effect on, the insured credit union. A document called Notice of Charges and Hearing sets out the specific charges and statement of facts supporting the charges. The Notice also arranges for an administrative hearing. The C AND D contains the required corrective actions. The C AND D action is designed to address only actions necessary to correct the most significant items.

A C AND D Order can be issued against an insured credit union or an institution-affiliated party. The term institution-affiliated party means any of the following:

►     Any committee member, director, officer, or employee of, or agent for, an insured credit union.

►     Any consultant, joint venture partner, and any other person as determined by the N C U A Board who participates in the conduct of the affairs of an insured credit union.

►     Any independent contractor who knowingly or recklessly participates in any violation of any law or regulation, any breach of fiduciary duty, or any unsafe or unsound practice.

The types of violations most likely to be remedied by a C AND D Order include:

►     Failure to maintain adequate books and records.

►     Deficient appraisal reports.

►     Transactions involving conflicts of interest.

►     Inadequate due diligence.

►     Inadequate control and oversight of operations.

There is a great deal of flexibility in what actions N C U A may require. In addition to ordering a cessation of certain activities, a C AND D Order may require affirmative corrective action, including:

►     Making restitution or provide reimbursement, indemnification, or guarantee against loss under specific conditions.

►     Restricting growth.

►     Rescinding an agreement or contract.

►     Disposing of any loan or asset.

►     Employing qualified officers or employees.

►     Taking such other action N C U A determines to be appropriate.

Orders to Cease and Desist are issued pursuant to the FCU Act section206(e), 12 U.S.C.

section1786(e). The provisions for the C AND D Order are set out in article-by-article form and prescribe those restrictions and corrective and remedial measures necessary to correct deficiencies or violations in the credit union and return it to a safe and sound condition. Violations of a C AND D Order can provide the legal basis for assessing civil money penalties (CMPs) against directors, officers, and other institution-affiliated parties. A C AND D Order may also be enforced through application to a U.S. district court. Moreover, a willful violation of a Final C AND D Order is itself grounds for conservatorship under the FCU Act section206(h)(1)(D), 12 U.S.C. section1786(h)(1)(D).

There are three types of cease and desist orders available to N C U A:

a.    Consent Order

A Consent Order is an Order to Cease and Desist that is entered into and becomes final through the board of directors' execution of a Stipulation and Consent document on behalf of the credit union. This type of order also requires the issuance of a Notice of Charges. The N C U A Board issues the Consent Order without the need for an administrative hearing. The Consent Order becomes effective at the time specified in the Order.

b.    Final (Permanent) Cease and Desist Order

Aside from its title, a Final C AND D Order is identical in form and legal effect to a Consent Order. However, a Final C AND D Order is imposed on an involuntary basis after issuance of a Notice of Charges, a hearing before an administrative law judge,

and a final decision and order issued by the N C U A Board. A Final C AND D Order is effective 30 days after service upon the credit union. Any Final C AND D Order is subject to review by a U.S. Court of Appeals.

c.     Temporary Cease and Desist Order

A Temporary C AND D Order is an interim order issued by the N C U A pursuant to its authority under the FCU Act section206(f), 12 U.S.C. section1786(f), and is used to impose measures immediately pending resolution of a Final C AND D Order. Such orders are typically used only when immediately necessary to protect the credit union against ongoing or expected harm. A Temporary C AND D Order may be challenged in U.S. District Court within 10 days of issuance, but it is effective upon issuance and remains in effect unless overturned by the court or until a final order is in place.

To issue a temporary order, N C U A must also issue a Notice of Charges initiating a proceeding to obtain a Final C AND D Order. In order to issue a Temporary C AND D Order, N C U A must determine that the violation or threatened violation or the unsafe or unsound practice(s) is likely to either:

►     Cause insolvency or significant dissipation of assets or earnings.

►     Weaken the condition of the credit union or otherwise prejudice the interest of the credit union's members.

The FCU Act section206(f)(3), 12 U.S.C. section1786(f)(3), provides for the issuance of a Temporary C AND D Order when an insured credit union's books and records are so incomplete or inaccurate that the financial condition of the credit union or details or the purpose of any material transaction can not be determined. This section also applies when a credit union does not provide adequate access to the books and records.

2.    What are the grounds for issuance of a Cease and Desist Order?

The grounds for a cease and desist action are set forth in the FCU Act section206(e)(1), 12

U.S.C. section1786(e)(1). A C AND D Order can be issued if any insured credit union or institution-affiliated party is either:

►     Engaging in or has engag...

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 Hello, this is Samantha Shares. This episode covers N C U A's 2025 Supervisory Priorities.

The following is an audio version of Letter to Credit Unions 25-CU-01. This podcast is educational and is not legal advice. We are sponsored by Credit Union Exam Solutions Incorporated, whose team has over two hundred and Forty years of National Credit Union Administration experience. We assist our clients with N C U A so they save time and money. If you are worried about a recent, upcoming or in process N C U A examination, reach out to learn how they can assist at Mark Treichel DOT COM. Also check out our other podcast called With Flying Colors where we provide tips on how to achieve success with N C U A.

And now the Supervisory Priority Letter.

Dear Boards of Directors and Chief Executive Officers:

This letter outlines the N C U A's supervisory priorities and other updates to the agency's 2025 examination program. Our priorities focus on the areas posing the highest risk to credit union members, the credit union industry, and the National Credit Union Share Insurance Fund (Share Insurance Fund).

There continued to be signs of financial stress on credit union balance sheets during 2024. Aggregate loan performance began to deteriorate in 2022, and the trend has continued through 2024. The overall loan delinquency rate is currently at its highest point since year-end 2013, while the rolling 12-month net charge-off rate is at its highest point since the second quarter of 2012. Additionally, the return on average assets continues to experience pressure from the interest rate environment and provision for loan and lease loss expense. Even considering these trends, the credit union system remains stable and relatively resilient against economic disruptions.

With that economic landscape in mind, below are the N C U A's primary areas of supervisory focus for 2025.

Supervisory Priorities for 2025

Credit Risk

Credit risk will remain a supervisory priority for 2025. Loan growth moderated during 2024 while overall delinquencies and charge-offs increased. Most notably, the performance within credit card portfolios has deteriorated much more rapidly than other aspects of federally insured credit union loan portfolios. The current delinquency rate and rolling 12-month net charge-off rate for credit card loans both exceed the peak that was reached during the global financial crisis fifteen years ago. Used vehicle loan performance has also materially deteriorated. The delinquency rate and rolling 12-month net charge-off rates for used vehicle loans are currently at the highest levels on record.

To address these matters, N C U A examiners will continue to review your credit union's lending and related risk-management practices. This priority will include reviewing the sufficiency of your loan underwriting standards, collection programs, Allowance for Credit Losses reserves, charge-off practices, management and board reporting, and management of any concentrations of credit risk. To the extent possible, examiners will also review your credit union's third-party risk-management practices when lending, servicing, or collection functions are outsourced.

Moreover, it is important for your credit union to work with borrowers encountering financial difficulties. These efforts are consistent with the credit union system's statutory mission of meeting the credit and savings needs of members, especially those of modest means. Accordingly, examiners will assess your credit union's modification and workout strategies for borrowers experiencing financial difficulty, including assessing whether your credit union's efforts were reasonable and conducted with proper controls and management oversight.

For more resources, refer to the Examiner's Guide and the following Letters to Credit Unions:

23-CU-05, Commercial Real Estate Loan Accommodations and Workouts

23-CU-04, Update to Interagency Policy Statement on Allowances for Credit Losses

14-CU-08, Home Equity Lines of Credit Nearing Their End-of-Draw Period

10-CU-03, Concentration Risk

09-CU-19, Evaluating Residential Real Estate Loan Modification Programs

07-CU-13, Evaluating Third Party Relationships

03-CU-01, Loan Charge-off Guidance

91-CU-120, Interest Rate Adjustment Errors for A R M Loans

Balance Sheet Management and Risk to Earnings and Net Worth

Credit unions are exposed to various risks affecting their earnings and net worth. Among the most significant are credit, liquidity, and market risk. These risks are tied to the institution's ability to manage its financial assets and liabilities and have a direct effect on earnings and net worth.

For credit unions, the primary market risk element is interest rate risk. Interest rate changes can affect the income credit unions generate from their lending and funding activities, which can affect the credit union's ability to build net worth. Loan losses can also diminish a credit union's earnings and net worth.

Over the last few years, the rising interest rate environment increased some credit unions' cost of funds faster than the returns on loans and investments, squeezing the net interest margin—a key driver of earnings. In 2023 and 2024, this increase in funding costs put pressure on earnings until loan and investment returns could catch up. If interest rates continue to decline, higher yielding loans and investments are prone to prepayment, which could accelerate as rates drop, reducing interest income from longer-duration assets. For the last several quarters, net interest margins have only slightly exceeded operating expenses. Any increase in operating expenses or further decline in loan performance could put earnings and net worth at risk.

In evaluating your credit union's earnings and net worth risk-management frameworks, examiners will weigh the current and prospective sources of earnings and the composition of net worth relative to your credit union's approved plans and thresholds. This approach will help examiners focus on trends in earnings and develop a better understanding of concentration risks for both earnings and net worth. Also, examiners will continue to consider the current and prospective sources of liquidity compared to funding needs to determine the adequacy of your credit union's liquidity risk-management framework. Examiners will review your credit union's policies, procedures, risk limits, and evaluate the adequacy of your credit union's risk-management framework relative to its size, complexity, and risk profile.

Liquidity resources and guidance can be found in the N C U A's Examiner's Guide and the Liquidity Risk Resources webpage.

For interest rate risk-related resources, refer to the Examiner's Guide and the following regulatory guidance:

Letter to Credit Unions 22-CU-09, Updates to Interest Rate Risk Supervisory Framework

Super...

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Hello, this is Samantha Shares. This episode covers 

A portion of The O C C's Semiannual risk perspective Special topic 

Increase fraud targeting the federal banking system. 

The following is an audio version of that topic. This podcast is educational and is not legal advice. We are sponsored by Credit Union Exam Solutions Incorporated, whose team has over two hundred and forty years of National Credit Union Administration experience. We assist our clients with N C U A so they save time and money. If you are worried about a recent, upcoming or in process N C U A examination, reach out to learn how they can assist at Mark Treichel DOT COM. Also check out our other podcast called With Flying Colors where we provide tips on how to achieve success with N C U A. 

And now the letter. 

The special topic focuses on the increasing trend in external fraud activity targeting consumers and the federal banking system. The frequency of both traditional and novel, more sophisticated fraud activities targeting customers and banks continues to increase. Banks should maintain sound fraud risk management practices through prudent controls and appropriate fraud monitoring capabilities to identify, investigate, mitigate, and report fraudulent activity. Banks can also support their customers by providing educational information about trending fraud activities and ways to protect themselves. 

Criminals continue to exploit traditional payment methods through check and wire transfer schemes. The Financial Crimes Enforcement Network (F I N C E N) September 2024 "Financial Trend Analysis" analyzed threat patterns and trend information on mail theft-related check fraud incidents over a six-month period in mid-2023. The report noted that financial institutions filed 15,417 B S A reports on mail theft-related check fraud, 13,618 (88 percent) of which were filed by banks. It described several types of check fraud such as bad actors altering stolen check payees and amounts, using the stolen check to create counterfeit checks, fraudulently signing the check, and selling the check or its identifying information on dark web marketplaces or encrypted social media platforms. Furthermore, the O C C's Customer Assistance Group observed an increase in the number of check fraud-related complaints submitted by consumers over the past year. 

Federal banking system-related wire transfer complaints that consumers submitted to the Customer Assistance Group reflect an increasing trend. For wire transfer schemes, the fraudster often poses as a trusted business, government agency, or even a bank employee, fabricating scenarios that require immediate action and convincing, with urgency, victims to wire money to a fraudster's account. In most cases, once the wire transfer is complete, the funds cannot be retrieved. 

While artificial intelligence (A I) can enhance fraud risk management capabilities, reduce costs, and improve efficiency, this and other new technologies are also being used to enable increasingly more sophisticated and frequent fraud tactics. Fraudsters could use A I to implement sophisticated frauds by digitally altering voices, biometric systems, or images (also known as "deepfakes"), or to facilitate social engineering schemes, identity theft, and impersonation of a trusted business or government agency. For example, deepfakes through voice replication have been used to perpetrate fraud by tricking voice biometric systems or by convincing a victim they are dealing with someone they know and trust, such as a family member. 

Increasing product and service digitization can also heighten fraud risk, including fraud targeting peer-to-peer (P2P) and other fast payment platforms. P2P payment platforms can provide enhanced capabilities and convenience to consumers and other users for managing payments. However, criminals also have exploited the faster, more streamlined payment capabilities and the irreversible and irrevocable nature of these payments. 

Effective fraud risk management includes appropriate internal controls, such as authentication, customer identification and verification processes, fraud monitoring, and open lines of communication between bank departments responsible for researching unusual activities. It is critical for banks to promptly identify, investigate, and resolve suspicious activities and potential fraudulent concerns. Banks should also continue to promptly identify, investigate, report, and resolve fraud concerns in accordance with applicable laws and regulations, including the B S A, Expedited Funds Availability Act (Regulation C C) and Electronic Fund Transfer Act (Regulation E). 

Recent increases in the volume of fraud cases have led to heightened unfair or deceptive acts or practices (U D A P) risk as some banks may take prolonged timeframes to complete investigations or implement broad account access limitations, preventing customers---including those who are not victims of fraud--- from accessing their funds. If banks on either side of the transaction do not complete investigations expeditiously, customers may not have access to funds for extended periods of time, which may create financial hardship for them. 

Banks can continue to support customers by providing information about scam and fraud trends and education of potential preventative measures. For example, to address the prevalence of text messaging and bank impostor scams, it can be beneficial to inform customers about how the bank will contact its customers regarding potential fraudulent transactions, as well as the strengths and limitations of various authentication methods and how to identify potential fraudulent schemes. Banks can also develop policies and procedures regarding what and how to communicate with customers when the bank determines that account access should be limited, taking care not to reveal the existence of any suspicious activity report (S A R) filing, and ensuring that the communication is otherwise consistent with safe and sound banking practices. Communications can provide critical information to customers seeking to access their funds. 

In addition, staff can be trained to identify and respond to customers seeking to conduct unusual transactions that have signs of fraud, such as a large withdrawal or wire transfer that may be outside of a customer's usual transaction habits. Employee training may also include identifying red flags for different types of financial exploitation, providing proactive approaches to detecting and preventing elder financial exploitation, and detailing actions for employees to take when they have concerns. When multiple departments are responsible for researching unusual account activities across functions such as B S A compliance, fraud prevention, consumer protection, and open lines of communication between the bank's departments are important and may result in enhanced coordination and expedited resolution. 

This concludes the fraud portion of this report. 

If your Credit union could use assistance with your exam, reach out to Mark Treichel on LinkedIn, or at mark Treichel dot com. This is Samantha Shares and we Thank you for listening. 

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CFPB Finalizes Rule to Remove Medical Bills from Credit Reports

Today, the Consumer Financial Protection Bureau announced a final rule that will remove approximately forty-nine billion dollars in medical bills from the credit reports of about fifteen million Americans. The C F P B's action will ban the inclusion of medical bills on credit reports used by lenders and prohibit lenders from using medical information in their lending decisions.

Director Rohit Chopra expressed that people who get sick shouldn't have their financial future upended. The rule will close a special carveout that previously allowed debt collectors to use the credit reporting system to coerce people into paying medical bills they may not even owe.

The C F P B's research has shown that a medical bill on someone's credit report poorly predicts whether they will repay a loan. With this new rule, approximately twenty-two thousand additional, affordable mortgages could be approved yearly. Americans with medical debt on their credit reports could see their credit scores rise by an average of twenty points.

This follows changes made by Equifax, Experian, and TransUnion, who previously announced they would remove certain medical debts from credit reports. The rule becomes effective sixty days after publication in the Federal Register.

This concludes the announcement.

If your Credit union could use assistance with your exam, reach out to Mark Treichel on LinkedIn, or at mark Treichel dot com. This is Samantha Shares and we Thank you for listening.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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Hello, this is Samantha Shares. Happy new Year!

This episode covers N C U A Board’s Approval of a  Non-Registered Investment Fund Pilot Program

The following is an audio version of that press release.    This podcast is educational and is not legal advice.  We are sponsored by Credit Union Exam Solutions Incorporated, whose team has over two hundred and Forty years of National Credit Union  Administration experience.  We assist our clients with N C U A so they save time and money.  If you are worried about a recent, upcoming or in process N C U A examination, reach out to learn how they can assist at Mark Treichel DOT COM.  Also check out our other podcast called With Flying Colors where we provide tips on how to achieve success with N C U A.

And now the press release.

NCUA Board Approves Non-Registered Investment Fund Pilot Program

On December 30th The National Credit Union Administration Board approved, by notation vote, an investment pilot program authorized under section 703 point 19 C of the N C U A’s regulations.

The N C U A will permit up to 30 complex federal credit unions to engage in investment activities prohibited under part 703 but permitted by the Federal Credit Union Act. Note A credit union is considered "complex" if its total assets exceed a specific threshold set by the N C U A. As of today,the threshold is 500 million dollars or more in total assets. A L M First Financial Advisors, LLC., a Securities and Exchange Commission registered investment advisor, requested the investment pilot program.

The requested pilot program would allow complex federal credit unions to invest in a series of non-registered investment funds comprised of consumer loans, as follows:

The pilot fund would be comprised of permissible consumer loans for federally insured credit unions with maturities of less than 10 years and overnight investments.

Federal credit unions must be complex and have a capital adequacy classification of well capitalized to invest in the fund and are limited to an aggregate investment of 50 percent of net worth as defined in part 702 of N C U A’s regulations.

The pilot program is subject to the A L M First Loan Fund Investment Pilot Program Requirements and Conditions, which are available on the N C U A website.

Under part 703 of the N C U A’s regulations, federal credit unions are authorized to invest in funds that are registered with the S E C or regulated by the Office of the Comptroller of the Currency, provided the underlying assets purchased by the fund are permissible under N C U A rules for federal credit unions.

This concludes the press release 

If your Credit union could use assistance with your exam, reach out to Mark Treichel on LinkedIn, or at mark Treichel dot com.  This is Samantha Shares and we Thank you for listening.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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NCUA approved their budget for 2025 and 2025 at the December Board meeting.  This is a recording of that item.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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A link to the action:

https://files.consumerfinance.gov/f/documents/cfpb_Zelle-Complaint_2024-12.pdf

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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Reach Out to learn how we assist our clients with NCUA so they  save time and money.

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https://ncua.gov/regulation-supervision/letters-credit-unions-other-guidance/consumer-harm-stemming-certain-overdraft-and-non-sufficient-funds-fee-practices

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Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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Reach out to learn how we assist our clients with NCUA so they save time and money.

Set up a free call here:

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Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

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• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

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Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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This episodes is an audio version of the FDIC's training for board members on corporate governance.

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• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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NCUA Simplifies Share Insurance Rules for Trust Accounts

Key Points:

- NCUA is merging revocable and irrevocable trust categories into a single "trust accounts" category for share insurance purposes

- New calculation method: Insured up to $250,000 x number of beneficiaries (max 5), capped at $1.25 million per grantor per credit union 

- Changes take effect December 1, 2026 to allow time for credit unions and members to prepare

- Expands coverage for mortgage servicing accounts to include servicer advances

- Provides more flexibility in recordkeeping requirements for determining insurance coverage

- Aims to simplify rules, facilitate faster insurance payouts, and align with recent FDIC changes

- Most members' coverage expected to remain the same, but some with complex trusts may see changes

The episode reviews the new rules in detail and provides examples of how coverage will be calculated under the changes. Credit unions should familiarize themselves with the new trust account rules before they take effect in 2026.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

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Hire us and gain:

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• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

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Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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# NCUA Chairman's Congressional Testimony: State of Credit Unions in 2024

## Episode Overview
A deep dive into NCUA Chairman Todd M. Harper's testimony before the House Financial Services Committee, covering the current state of the credit union system, key challenges, and regulatory initiatives.

## Key Points

### Credit Union System Performance
- Total assets nearly $2.3 trillion
- Total outstanding loans exceed $1.6 trillion
- Net worth ratio: 10.84%
- Return on average assets: 0.69%
- Warning signs: rising delinquency rates, declining capital levels

### Major Concerns
- One in five credit unions rated as troubled (CAMELS 3, 4, or 5)
- Number of troubled complex credit unions tripled in Q2 2024
- Commercial real estate showing stress due to hybrid work environments
- Rising consumer financial stress affecting loan performance

### Cybersecurity Initiatives
- Deployed updated Information Security Examination procedures
- Received 1,000+ reportable cyber incidents since September 2023
- 70% of cyber incidents related to credit union vendors
- Expanded partnerships with CISA and FBI

### Consumer Protection Efforts
- Focus areas: overdraft programs, fair lending, auto lending
- Eight credit unions referred to DOJ for discrimination in 2024
- First-ever race-based redlining settlement against a credit union
- New requirements for large credit unions to disclose overdraft fees

### Minority Depository Institutions (MDIs)
- 490 MDI credit unions serving 6.6+ million members
- Combined assets over $90 billion
- 39 MDIs received nearly $1.4 million in technical assistance grants
- Average asset size: $183 million

### Legislative Requests
1. Restore third-party vendor oversight authority
2. Reform Central Liquidity Facility
3. Provide more flexibility in Share Insurance Fund management
4. Increase Community Development Revolving Loan Fund to $10 million

## Hurricane Response
- Detailed response to Hurricanes Helene and Milton (Sept/Oct 2024)
- Provided emergency grants and loans to affected credit unions
- Extended regulatory filing deadlines
- Supported cash needs during telecommunications outages

## Notable Statistics
- Share Insurance Fund equity ratio: 1.28%
- Share Insurance Fund net income: $154.3 million
- Insured shares and deposits: $1.76 trillion
- Uninsured shares and deposits: $169.4 billion

## Contact Information
For more information: [ncua.gov](https://ncua.gov)

## Additional Resources
- NCUA's Financial Technology and Digital Asset webpage
- Credit Union Diversity Self-Assessment tool
- Automated Cybersecurity Evaluation Toolbox (ACET)

*Show notes based on testimony delivered November 20, 2024*

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

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• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

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Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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Hello, this is Samantha Shares. This episode covers N C U A’s Authority to Assess Civil Money Penalties as outlined in its Enforcement Manual. 

The following is an audio version of manual.    This podcast is educational and is not legal advice.  We are sponsored by Credit Union Exam Solutions Incorporated, whose team has over two hundred and Forty years of National Credit Union  Administration experience.  We assist our clients with N C U A so they save time and money.  If you are worried about a recent, upcoming or in process N C U A examination, reach out to learn how they can assist at Mark Treichel DOT COM.  Also check out our other podcast called With Flying Colors where we provide tips on how to achieve success with N C U A.

And now civil money penalties.

1.     What are civil money penalties?

The FCU Act section206(k), 12 U.S.C. section1786(k), contains N.C.U.A.'s authority to issue civil money penalties; N.C.U.A. Rules and Regulations. Section 747, Subpart A, contains the rules and regulations governing civil money penalty administrative hearings. The N.C.U.A.

Board may assess civil money penalties against either a credit union or an institution­ affiliated party (see definition of institution-affiliated party above). The FCU Act specifies three tiers of civil money penalties, as follows:

►     First tier. Any credit union or institution-affiliated party that violates a law or regulation, a final order of the N.C.U.A. Board, a published agreement with the Board (such as a published Letter of Understanding and Agreement), or a condition imposed in a published writing by the Board in connection with the granting of any application (such as the Insurance Agreement), may receive a penalty of not more than 5,000 dollars  for each day of the violation. First tier penalties may apply to credit unions that, even after warnings, repeatedly submit late or substantially inaccurate call reports.

►     Second tier. If the credit union or institution-affiliated party commits a first tier violation, and exhibits reckless conduct or a breach of fiduciary duty, and the violation, practice or breach is part of a pattern of misconduct, or causes more than a minimal loss to the credit union, or results in a monetary gain or other benefit to the institution-affiliated party, then the N.C.U.A. Board may assess a civil money penalty of not more than 25,000 dollars per day for each day of the violation.

►     Third tier. Any credit union or institution-affiliated party that knowingly commits the first tier violations, knowingly engages in unsafe or unsound practices, knowingly breaches any fiduciary duty, or knowingly or recklessly causes a substantial loss to the credit union or a substantial monetary gain or other benefit to a party because of the violation, breach, or practice, may receive assessment of a civil money penalty of not more than $1,000,000 per

day for each day of the violation, or in the case of a credit union, 1 percent of assets, whichever is less.

2.    How are civil money penalties assessed?

The normal administrative procedure for a civil money penalty action is as follows:

1.    The regional director notifies the party of his or her intent to recommend to the N.C.U.A. Board the issuance of a civil money penalty, requesting a written response from the party.

2.    The N.C.U.A. Board issues a Notice of Assessment, setting forth a statement of the law and facts on which it bases the assessment.

3.    The assessed party has 90 days to make payment, but may request a hearing within 20 days.

4.    An administrative law judge will hold a formal hearing if requested.

5.    After the administrative hearing, the administrative law judge submits a recommended decision to the N.C.U.A. Board.

6.    The N.C.U.A. Board issues its final order.

7.    An institution-affiliated party or credit union may appeal to the U.S. Court of Appeals within 20 days of receipt of the final order.

This concludes the N.C.U.A. civil money penalty authorities and policies.

If your Credit union could use assistance with your exam, reach out to Mark Treichel on LinkedIn, or at mark Treichel dot com.  This is Samantha Shares and we Thank you for listening.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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Episode Summary
This episode covers the National Credit Union Administration's (NCUA) examiner guidance on Preliminary Warning Letters (PWLs) to credit unions, as outlined in the National Supervision Policy Manual.

## Key Points

1. Purpose of Preliminary Warning Letters (PWLs):
   - Issued when a credit union's problems are serious or persistent
   - Used when a credit union's board is unwilling to sign a Letter of Understanding and Agreement (LUA)
   - Supports potential formal administrative action

2. Content of a PWL:
   - Written from the Regional Director's perspective
   - Lists serious areas of concern and cites relevant regulations
   - Includes required actions and timeframes for resolving issues

3. Process for Issuing a PWL:
   - Examiners draft PWLs after examinations or supervision contacts
   - Division of Supervision (DOS) reviews and processes for Regional Director approval
   - Can be hand-delivered or mailed, depending on severity of issues

4. Supervision of Credit Unions with PWLs:
   - Follow-up examinations typically every 120 or 180 days
   - Examiners document compliance with PWL in Status Updates
   - PWLs usually not outstanding for longer than 12 months

5. Terminating a PWL:
   - Recommended when credit union meets specific performance standards
   - Examiners prepare draft removal letter for Regional Director's signature

## Sponsor
Credit Union Exam Solutions Inc. - Offering assistance with NCUA examinations

## Additional Resources
- Sample PWLs and BSA-specific PWL templates mentioned
- Reference to NCUA Instruction 4820, Enforcement Manual

## Call to Action
For credit unions needing assistance with exams, contact Mark Treichel on LinkedIn or at marktreichel.com.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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Hello, this is Samantha Shares. This episode covers N C U A’s authority to Involuntarily Liquidate a Credit Union.

The following is an audio version of N.C.U.A.’s Liquidation authorities.    This podcast is educational and is not legal advice.  We are sponsored by Credit Union Exam Solutions Incorporated, whose team has over two hundred and Forty years of National Credit Union  Administration experience.  We assist our clients with N C U A so they save time and money.  If you are worried about a recent, upcoming or in process N C U A examination, reach out to learn how they can assist at Mark Treichel DOT COM.  Also check out our other podcast called With Flying Colors where we provide tips on how to achieve success with N C U A.

And now liquidations.

INVOLUNTARY  LIQUIDATIONS

1.     What is the purpose of this chapter?

This chapter provides guidance in processing involuntary liquidations.

2.    What are the types of involuntary liquidations?

a.     Title I involuntary

Undersection120 of the FCU Act, 12 U.S.C. section1766, the NCUA Board can place a solvent federal credit union into involuntary liquidation for violations of its charter, its bylaws, the FCU Act, or the NCUA Rules and Regulations. Also, under section120, 12 U.S.C. section1766, the NCUA Board can place a federal credit union into involuntary liquidation upon finding that the board or liquidating agent did not conduct a voluntary liquidation in an orderly or efficient manner or in the best interests of the members.

The rules and regulations relating to these administrative proceedings are contained in NCUA Rules and Regulations section747, Subpart E. The effect of this action is the elimination of a federal credit union as a legal entity after due process provided for by section120(b) of the FCU Act, 12 U.S.C. section1766, and Part 747, Subpart E, of the NCUA Rules and Regulations. It is the most drastic enforcement action that can be taken against a solvent federal credit union.

Since Title I liquidation is not a commonly used administrative action, examiner involvement will differ from case-to-case.

b.    Title II involuntary

Section 207 of the FCU Act, 12 U.S.C. section1787, requires the NCUA Board to close for liquidation any federal credit union it deems bankrupt or insolvent. In these cases, the NCUA Board must also appoint itself as liquidating agent. In addition, the NCUA

Board can accept appointment as liquidating agent of a bankrupt or insolvent federally-insured, state-chartered credit union.

c.     Purchase and assumption

A purchase and assumption (P&A) is an action similar to a merger, but unlike a merger the NCUA Board places the credit union into involuntary liquidation first. In a P&A, another credit union or another financial institution assumes all or part of the assets, liabilities, and shares.

3.    What are the goals for an involuntary liquidation?

The primary goals of an involuntary liquidation are:

►   Prompt return of members' shares.

►   Payment to the creditors.

►   Disposition of the remaining assets to the NCUSIF.

4.    What are the grounds for an involuntary liquidation of an insolvent credit union pursuant to section207 of FCU Act?

The grounds for this most severe action is insolvency or bankruptcy as defined in

section700.2(e) of NCUA Rules and Regulations.

For a liquidation pursuant to section207, 12 U.S.C. 1787, of the FCU Act, the credit union has no right to a pre-closure administrative hearing. The federal credit union's charter is immediately revoked and the credit union is placed into involuntary liquidation. The credit union may, however, challenge the action in U.S. District Court within 10 days. It is critical, therefore, that the finding of insolvency be based upon tangible evidence and indisputable circumstances using the most current information available.

The examiner prepares a supplemental memorandum for the liquidation package that contains all significant data to support the recommended action, including an analysis of the various exceptions to insolvency set forth in section700.2(e) of the regulations. It is imperative that the administrative record adequately supports insolvency. The examiner must be prepared to testify in court to establish the reasonableness of the insolvency calculation. For this reason, involuntary liquidations require the concurrence of the Office of General Counsel to ensure that the liquidation package is legally sufficient.

A Notice of Revocation of Charter and Involuntary Liquidation and Appointment of a Liquidating Agent will be served on the federal credit union. The order is effective immediately upon service, and all assets, books and records of the credit union immediately become the property of the NCUA. Agents for the Liquidating Agent will be appointed as provided in section207(a) of the FCU Act, 12 U.S.C. section1787.

5.     What are the grounds for an involuntary liquidation of a solvent credit union?

Pursuant to the authority in section120(b)(1) of the FCU Act, 12 U.S.C. section1766(b)(1), the NCUA Board may suspend or revoke the charter of a federal credit union that has violated any provision of its charter, its bylaws, the FCU Act, or NCUA regulations. This type of action may also be taken for reasons of bankruptcy, but generally liquidation of insolvent credit unions are initiated under section207 of the FCU Act, 12 U.S.C. section1787.

Examples of conditions that may warrant recommending revocation of charter in a solvent credit union include:

►   Abandonment of the credit union's operations and affairs by the officials.

►   Plant closing and officials refusing to vote to present the question of liquidation to the members. Such plant closing may force insolvency under the concept of an ongoing concern, or may cause a dissipation of the assets and expose the creditors and the NCUSIF to a greater than normal risk.

►   Other specific serious violations of its charter, its bylaws, the FCU Act, or regulations that cannot be reversed and that may cause insolvency.

►   Serious operational deficiencies that the officials have not acted to correct and which, if allowed to continue, may cause insolvency.

Abandonment shall be deemed to have occurred when all or most of the elected and the appointed officials have demonstrated by their actions, or failure to act, an intent to end operations. Proof is evidenced when an active quorum cannot or will not be formed by the remaining officials.

The examiner recommends a Notice of Intent to Revoke Charter whenever the timeframe for due process will not create a greater risk of loss to the members, the creditors, and the NCUSIF than exists at the time of the recommendation. The examiner should be aware that the credit union will continue ...