ALEXANDRIA, Va. (10/9/13)--Changes that will streamline credit union examination reports and improve the overall exam process by setting clearer expectations for credit unions and examiners will be introduced on Jan. 1, the National Credit Union Administration said in a letter to credit unions (13-CU-09) released Tuesday. The Credit Union National Association has long sought the kind of changes provided in this NCUA letter, Deputy General Counsel Mary Dunn noted.
The NCUA noted it considered feedback from credit union industry officials as it developed these changes. The agency also incorporated recommendations from the U.S. Government Accountability Office and the NCUA's own Office of Inspector General.
One specific change outlined by the agency is separating the Document of Resolution (DOR) and Examiner's Findings sections of the examination reports into stand-alone documents.
"Separating the DOR and Examiner's Findings documents--and providing descriptive definitions of each document's purpose--will help credit union officials clearly differentiate between major and minor problems in order to prioritize corrective actions," the agency wrote.
Examiner concerns and documented support for material problems listed in the examinations will be included in the DOR, along with corrective action plans, the agency added. "This will help credit unions and NCUA implement timely problem resolution of the most critical and material concerns" and "enhance consistency in the exam process," the letter said.
These and other changes will better clarify the priority exam action items to be resolved, reduce redundancy, and ensure consistency, the agency wrote.
A new status update template has also been developed as part of the exam document changes. The update will provide details on credit union outstanding administrative actions, including Letters of Understanding and Preliminary Warning Letters, the agency said. The informal discussion document will be eliminated.
Examiners will need to follow up with credit union officials on any outstanding DOR items within 120 days after the timeframe for completion has passed. Credit unions that have received DORs instructing them to cease unsafe or unsound practices will need to notify their respective NCUA Regional Office in writing once they have implemented corrective actions, the letter adds.
Reasonable solutions provided by a given credit union will become the corrective action plan included in the DOR, the NCUA said.