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Exam modernization efforts outlined in NCUA webinar

ALEXANDRIA, Va. (1/23/14)--"Examination Report Modernization" was the topic of a free National Credit Union Administration webinar offered Wednesday, and it outlined changes the agency made in 2013 to streamline and improve the consistency of the examination report process.

The webinar was intended to give participants a better understanding of new procedures related to Documents of Resolution (DOR) and examination reports.   The changes were effective Jan. 1 and were meant to set clearer expectations for credit unions and examiners. They were first introduced in October 2013 in the agency's Letter to Credit Unions (13-CU-09).
Presenters at the NCUA's 2 p.m. (ET) webinar included Dominic Carullo, an economic development specialist with the Office of Small Credit Union Initiatives; Amanda Parkhill, a loss and risk analyst with the Office of Examination and Insurance; and Clarence Jones, an NCUA national training specialist.
In addition to improved consistency, the experts noted that the goals of NCUA's exam modernization include:

They said key changes adopted in 2013 included:

  • Less redundancy;
  • Clear prioritization; and,
  • Input from credit union management.
  • DORs now have a required 120-day follow up from the examiner;
  • DORs are to be solely used for material unsafe and unsound practices;
  • Problems should be discussed with management throughout the examination and a corrective plan for problems should be developed by management. NCUA will develop a plan if management fails to do so; and,
  • Clarifying that DORs may be appealed and how.

Participants were also told that there is now a clear distinction between examiner findings and the DOR, and the webinar detailed the process, consequences and follow-up requirements for both. It was also noted that DORs and examiner findings should be discussed with management before being presented to a credit union board.

Unlike the DORs, examiner findings cannot be appealed, and the Credit Union National Association is pressing this issue with NCUA. An unresolved finding can impact management scores and CAMEL ratings.
The NCUA also said it is working on a new exam process for small credit unions, which it defines as $50 million or less in assets; although the agency also has indicated the new procedures may not apply to credit unions with assets above $30 million.  CUNA is seeking clarification from the NCUA, since it is not clear why all credit unions under $50 million would not be subject to the new procedures.

The agency also underscored in the webinar that examiners should set aside time to discuss issues with credit union staff and that credit unions can contact supervisory examiners with issues.

The NCUA's webinar will be posted on its website in about three weeks.


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