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SECU opts for full CAMEL disclosure to members
RALEIGH, N.C. (10/14/11)--North Carolina State Employees’ CU (SECU) is choosing to go “where no credit union has gone before”--requesting a one-year trial disclosure of its CAMEL code. The CAMEL rating system is used by the North Carolina Credit Union Division--and by most other federal and state financial regulators--to evaluate the overall health of a state-chartered credit union. SECU sought the one-year trial disclosure in an effort to test a new standard for full transparency. The CAMEL rating system is based upon five elements of a credit union’s operations: capital adequacy, asset quality, management, earnings, and liquidity/asset liability management. Examiners rate credit unions using a numeric scale of one to five for each component, along with an overall composite rating for the credit union, with one as the highest rating and five as the lowest. Financial institutions with assets greater than $10 billion should expect greater disclosure and compliance, said the $23 billion asset credit union. This trial disclosure of CAMEL rating transparency is yet another way for it to demonstrate its “Do the Right Thing” philosophy to its 1.7 million member-owners, SECU said. CAMEL ratings are confidential figures not generally published by regulatory agencies. SECU obtained authorization from the administrator of the North Carolina Credit Union Division to include its composite CAMEL rating of two for the period ending Sept. 30, in a footnote in its June 30 Audit Report. The CAMEL 2 composite rating has been typical for SECU during the past 10 years. “SECU is identified by its member-owners as a trusted provider of financial services,” said Mike Lord, SECU senior vice president of finance. “At a time when so many other large financial institutions in the marketplace are not viewed as trustworthy, SECU wants to uphold its positive reputation through full transparency. While there are no existing regulatory requirements for safety/soundness rating disclosure, SECU believes that, as a member-owned cooperative, it is always best to keep credit union members apprised of the overall level of financial performance of their credit union. “We welcome the opportunity to test the value of disclosure of this rating with our members,” he added. “SECU has traditionally published its ‘capital rating’ each year, and we feel the CAMEL rating may provide additional useful information. SECU remains ‘well-capitalized’--the highest category--under federal law.”

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