When asked what credit union regulatory or supervisory issueskeep him awake at night, Steve Pleger, senior deputy commissionerat the Georgia Department of Banking and Finance, talked aboutfundamentals.
|“I would like to say that the supervisory issues that keep meawake at night are something new and exotic, but they're not,”Pleger said. “The issues that keep me awake at night are timelessfundamentals in the operation of safe and sound credit unions, suchas governance, controls, and concentrations.”
|Pleger shared his thoughts in Stateline, the NationalAssociation of State Credit Union Supervisors' publication. TheGeorgia Department of Banking and Finance included the Q&Afeature in its Financial Institutions Bulletin.
|“Safety and soundness begin with an informed and engagedboard of directors providing oversight to and establishing thetone for credit union management,” Pleger explained.
|Control functions, such as audit and loan review, serve as theboard of directors' eyes and ears, ensuring that the board hastimely, unfiltered, and actionable information to support oversightand strategic decision making, he suggested.
|“Concentrations, which we describe as putting too many eggs inone basket, are too often the killer of otherwise healthy creditunions when not accompanied by strong risk management processes and appropriately ample net worthpositions,” Pleger said.
|He added, “The need for constant vigilance and improvement inthese three fundamentals are what keep me awake at night, andprobably always will.”
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