The agency said it will begin using the tool in examinations of large credit unions with more than $1 billion in assets, allowing the agency to create a baseline for the most complex institutions, while also testing and refining the tool.

Bank Secrecy Compliance. This continues to be a high priority for the agency, McWatters said. He added that the Customer Due Diligence regulations for financial institutions become effective on May 11 and that examiners will begin assessing credit union compliance with the rule during the second half of 2018.
Internal Controls and Fraud Prevention. Credit union safety and soundness includes "establishing a strong system of internal controls and a comprehensive approach to managing fraud risk," he said.
Interest Rate and Liquidity Risk. The agency began using a revised interest rate risk supervisory tool and examination procedures at the beginning of this year, McWatters said. Since not all credit unions were examined this year, some credit unions will be examined for the first time using this tool in 2018.
Automobile Lending. Examiners will apply "additional scrutiny" to credit unions with exposure to higher risk forms of auto lending, McWatters said.
Commercial Lending. The NCUA's revised regulation for commercial lending went into effect Jan. 1 and examiners will continue to focus on credit union commercial loan procedures and assess risk management processes.
Consumer Compliance. The examiners will evaluate credit union efforts to comply with the Military Lending Act, overdraft policies and mortgage disclosure rules.

Instant Insights /

NCUA Sets Supervisory Priorities for 2018

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