The NCUA’s Virtual Town Hall this week revealed a number of back-office changes and progress on issues important to credit unions, as senior executives fielded questions from submitted online during the web broadcast event.
In response to a question at the Thursday session about when the examiner’s guide will be made public, NCUA Director of Examinations and Insurance Larry Fazio said the guide, available on the NCUA’s website, is old and in the process of being updated. Fazio also discussed the national supervision policy manual, which it plans to release to the public soon.
The manual, which Fazio said was full of back-office policies and procedures, also contains “parts that are not for public consumption”, and must be redacted first.
The examiner’s guide came up in another question, in which a credit union wanted to know if its examiner was correct in saying the guide is just a guideline. Fazio confirmed that is the case, calling it “a guide, not a hard and fast requirement” and “kind of an encyclopedia and how-to manual.”
The supervision of California credit unions is unlikely to be transferred back to the NCUA’s Region 5 office anytime soon, Fazio added, due to a “deficiency of senior examiners on the West Coast.” Until the NCUA can beef up examiner seniority and seasoning, California and its large, complex credit unions will continue to be supervised out of Region 2.
Directors worried they will have to prove their financial literacy to satisfy a regulatory requirement can rest easy. NCUA Board Chairman Debbie Matz said while examiners may check to be sure credit unions have a policy in place to train directors that need help with balance sheets and income statements, “examiners won’t be interrogating any board members.”
Board members, both new and existing, that have appropriate financial competencies aren’t required to do anything to prove it, she said.
NCUA staff also discussed when it might propose or finalize new rules. A final loan participation rule is expected in the next three to six months, one executive announced. Additionally, a new rule on derivatives could come when the board is ready, Fazio said.
Executive Director David Marquis said the NCUA currently has a working group developing a recommendation on derivatives authorities for the board, but the bigger issue for the agency is getting examination staff up to snuff on the topic.
“It’s kind of a big deal because it won’t be a cheap event for us to hire the right people with the expertise,” Marquis said.
Fazio wouldn’t directly answer a question asking if the NCUA expects to collect a share insurance fund premium in 2013, instead saying the board would announce the expected corporate assessment range during its November board meeting, as well as any possible insurance premiums.