Dear Editor,

Mr. Fryzel is just plain wrong in his assessment of moving to an 18-month exam cycle. This is nota case of monkey see, monkey do. It is very relevant that theNCUA follow the FDIC, as appropriate. To be clear, NAFCU andCongress are not asking the NCUA to blindly follow theFDIC. NAFCU has long asked the NCUA to change its exam cyclefor well-run healthy credit unions, as appropriate. The fact thatthe FDIC is going to do the same for banks puts credit unions at adisadvantage. Exams cost time and money, both to the creditunion and to the NCUA. Those resources should be put wherethey are really needed.

I am not a regulator, but I have personally read every singlematerial loss review that the NCUA has publiclyavailable. Failure of an institution is usually due to a wholehost of factors. That is what the CAMEL system is designed tomeasure. The exam looks at the credit unioncomprehensively. Unless there is massive fraud, a credit unioncannot go from a 1 to a 5 overnight or even in 18 months. And if itdid, the signs would show up on the quarterly financials and theNCUA could step in, as appropriate.

The NCUA has an incredibly important role in ensuring that wehave a safe and sound credit union system, but all signs point toallowing the vast majority of credit unions to focus on seeingtheir members' faces and not their examiners. Banks and creditunions operate in the same economy and the samecommunities. We are all on the same road. All NAFCU isdoing is asking the NCUA to do is step on the gas and implement achange it has indicated it is willing to consider. We allshould be able to take advantage of savings at the pump.

Besides, the NCUA's return to an 18-month exam cycle ishardly the equivalent of jumping off a bridge. Not when wehave the NCUA's risk-based capital rule to take care of us all now,right?

Carrie Hunt

Executive Vice President of Government Affairs and GeneralCounsel

NAFCU

Arlington, Va.