ALEXANDRIA, Va. — NCUA and NASCUS, as well as the state regulators, serve as resources and sounding boards for regulatory trends and concerns.

“We really work together from the ground up,” said NCUA veteran Cherie Umbel in the department of public and congressional affairs. “When we review the regulations they're certainly brought in,” she said.

NCUA PACA Director John McKechnie agreed, stating that NCUA regularly works with NASCUS and the individual state regulators. Other than regulations, he said NCUA also works with the state regulators on conservatorships of state-chartered, federally insured credit unions, for example, as well as consulting them in the legislative arena. “I think there's clearly a commonality of interest between the state regulators and the federal system.”

McKechnie pointed to possibly the most tangible evidence of this relationship, which is not a regulation or exam technique, but a living, breathing human being. NASCUS State Program Coordinator Tammy Brown-Gentilini actually has her office set up in NCUA's Alexandria, Va.-headquarters.

Brown-Gentilini has been particularly busy of late coordinating state examiner course requests with NCUA training sessions, as well as coordinating the logistics. “We basically have all the state examiners come through the same training all our examiners do,” NCUA Director of Examination & Insurance Dave Marquis said. He noted that some classes end up with more state examiners than federal in them. After that they do some field training and state-specific training and they return for more advanced learning like CAMEL and ratio analysis, he explained. While NCUA jointly examines about 15% of federally insured state-chartered credit unions with state examiners for quality control purposes, Marquis said, NCUA relies on the state examiners for the rest. Brown-Gentilini is fielding about 200 e-mails and 60 calls a day, she said. NASCUS established the National Institute for State Credit Union Examination, its educational arm, in 1982 and has had a contract with NCUA since 1992. Marquis said he has addressed NASCUS' schools in the past.

Additionally, NCUA examiners meet with Brown-Gentilini during the early stages of their training as well as meeting with NASCUS staff at their headquarters. NASCUS is currently trying to work in some time later in the training process as well regarding the relationship between state and federal examiners. Brown-Gentilini manages NASCUS' online university, which offers around 1,000 courses. NASCUS President/CEO Mary Martha Fortney, who has been with the organization about 14 years, explained that NCUA and NASCUS “worked together to produce the examination platform,” actually a pre-cursor to AIRES, the Automated Integrated Regulatory Examination System. NCUA and all of the states except Utah use AIRES now as opposed to the early 1970s when everyone was doing their own thing, Fortney said. “It is very important that there is this working relationship between NCUA and NASCUS and the states,” she emphasized. In fact, Brown-Gentilini serves as the liaison to the NASCUS representatives on the NCUA committees. NASCUS currently has representation on NCUA's National Examination Committee, Surveillance System Working Group, and Technical Development Team. The exam committee meets once or twice a year in-person and other times via teleconference, she said, to gather comments from the examiners on guidelines, process and emerging issues. Surveillance System Working Group, which is not as ominous as it sounds, meets every spring to make recommendations for changes to the next year's data collection and 5300 Call Reports. The Technical Development Team specifically works on keeping the AIRES software up-to-date.

“It helps a lot when you're working on something together, you're making a better product. You're making something that you reach consensus on…I can't imagine how it must have been years ago,” Fortney commented.

She also pointed out that the cooperation goes beyond strictly the examination process. For instance, Fortney said NASCUS was working with NCUA Chairman JoAnn Johnson on the agency's current bylaw review.

NASCUS has also regularly had an NCUA Board member who serves as a liaison, which is currently Board Member Gigi Hyland. The arrangement works very well, Fortney said. “We serve as each other's resources,” she said, adding it is definitely not a “one-way street.” Hyland said she “really wants to foster an ongoing dialogue” with NASCUS and the state regulators. “We have a lot more in common than we do differences,” she stressed. Part of the commonality of making sure credit unions are safe and sound is ensuring credit unions can and do offer the products and services their members want and need. Since serving as the board's NASCUS liaison, Hyland has addressed NASCUS annual meeting and brought NASCUS Chair Linda Jekel, the state regulator in Washington, along with the rest of the NASCUS Board and executives in to meet with NCUA staff for a “refresher” course on what NASCUS' mission is and how that aligns with NCUA. “I've also collaborated with Linda to bring back the national meeting,” Hyland said. “It's a great forum for issues we have in common.” An issue that NCUA and NASCUS are both working on is data gathering on credit union service to those of modest means. The national meeting returns this year March 25-27 in Salt Lake City. “We feel that both NCUA and state regulators benefit from a national audience and for everyone to be in one place to talk about policy issues, emerging issues, regulator-to-regulator dialogue,” Fortney said. “The regional meetings are very important and they continue but the importance of having a national forum for the regulator-to-regulator dialogue we feel, and NCUA agreed, was important to bring back.” Regulators from California do not have the opportunity to meet with the New York regulators at regional meetings, she indicated.

“We all work better together when we have an open dialogue,” McKechnie agreed. –scooke@cutimes.com

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NCUA, NASCUS Work Together for Health, Safety and Soundness of CU Industry

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