A North Carolina credit union executive had a suggestion Friday on how to end the stalemate between state and federal regulators over dual exams the NCUA imposed after State Employees’ Credit Union revealed its CAMEL score.
Feb. 10, 2012 - NCUA Says Dual Exams Over, For Now
“I think there can be a compromise by simply letting the rating release authority end by June or whatever the date and then exit the program,” offered Judy Tharp, president/CEO of the $124 million Piedmont Advantage CU of Winston-Salem.
That way the routine exam schedule can be resumed and the pilot concept of releasing CAMEL ratings would be dropped along with the additional NCUA examinations, she said.
“If Jerrie agrees to back off and everyone sits down at the table and agrees, ‘We won’t do it again’ that might work,” suggested Tharp, who like other CEOs has bemoaned the sudden NCUA examiner swarm which rattled the 52 state-chartered CUs over the last three weeks in the agency clash with Jerrie Jay, who heads up the state’s Credit Union Division.
Tharp warned that dual exams could generate conflicting reviews and findings between the two agencies, which in turn would trigger more expense and wasted time for CUs already enduring heavy regulatory burden.
She agreed with other CEOs who labeled the NCUA sweep as retaliation for Jay and the state attorney general’s office decision to allow the CAMEL release. The NCUA has vigorously defended the start of dual exams as necessary to protect the system and has sharply criticized Jay for disregarding agency policy.
Other credit union leaders have called for NCUA Chair Debbie Matz to come to the state and help settle the dispute.
“There has to be a way for the two sides to listen courteously to each other, though I do think NCUA has over-reacted in this melodrama,” said Patty Idol, president/CEO of the $129 million Mountain CU of Waynesville.
She said three NCUA examiners spent two weeks at her credit union, “and let me say that took a good chunk of our time certainly throwing us off our routine during a crucial part of the year.” Idol said she and her staff had been planning to spend that time following through on strategic directives that came out of a recent meeting of her board.
In her comments Wednesday to a town hall meeting, NCUA Chairman Debbie Matz apologized for any inconvenience but said the issue of protecting CAMEL confidentiality remained paramount.
Idol, who is a director of the North Carolina Credit Union League, which has tried to mediate the NCUA/state dispute, said also she has heard at least three or four state CUs that are now considering converting to a federal charter.
“I think they have already requested the initial paperwork,” Idol said, declining to identify them.