June 13, 2014

Economic & CU Monitor: Exam experiences mixed

June 16, 2014 – Credit union respondents to NAFCU's June Economic & CU Monitor survey cited interest rate risk (75 percent) and cybersecurity (53.6 percent) as the areas of greatest focus during examinations.

NAFCU's Monitor survey looked both at the exam process and NCUA's 2014 supervisory focus. It compared credit unions' exam experiences to expectations set out in NCUA's Letter to Credit Unions 14-CU-02, which identifies issues and risks NCUA will focus on as well as the agency's stated goal to streamline the exam process.

Among supervisory issues related to safety and soundness, 56 percent of survey respondents said that asset/liability management was the greatest area of focus during their most recent exam. That was followed by credit risk management (40 percent) and member business loans (20 percent).

In other survey findings:

  • 41.7 percent of respondents would be more likely to appeal the results of their last examination if an independent appeals process were in place.
  • 14.7 percent of respondents found their exam experience to be more positive than in the past, with the same number reporting it to be worse, and the remainder seeing no change.
  • 92.3 percent of respondents are changing policies and procedures in response to a recent exam.

June's Monitor also reported that credit union respondents saw a 5.2 percent increase in membership growth in April, with year-over-year share growth at 5 percent. Respondents noted growth in their capital ratios to 10.83 percent on average and growth in loans of 11.3 percent on average.

Other findings from June's Economic & CU Monitor can be found online. (Login required.)