WASHINGTON (8/21/15)--CUNA Chief Advocacy Officer Ryan Donovan said Thursday that it is important that CUNA, the state credit union associations, and credit unions keep up a dialogue with federal and state regulators about examination issues.
"The fact that credit unions have concerns with the conduct and fairness of their exams surprises no one. Credit unions have concerns with such things as poor examiner training, inconsistencies between state and federal exams, and a lack of a meaningful review process if exam findings are disputed, among other things," Donovan noted.
"There are steps regulators can and should take to shore up the quality of the examination process," he added.
For instance, CUNA has suggested the National Credit Union Administration could reduce costs and improve exams by using enhanced technology to streamline the process.
CUNA also recommends that the agency use its wide latitude to review its current rule dictating the frequency of examinations, as highlighted this week in a letter sent to NCUA by the Cooperative Credit Union Association. CCUA President/CEO Paul Gentile sent extensive comments to the agency joining CUNA’s calls for reform.
CUNA's Donovan continued, "We agree it’s time for NCUA to address the examination cycle--adjusted to a shorter timeframe in 2009 in response to the country's financial crisis. We have encouraged them to do so, and we have asked federal lawmakers to help by urging NCUA to refine the examinations to be more consistent with the examination cycle for banks.”
"However, this shouldn't take an act of the U.S. Congress. NCUA has the authority, and more than five years after the crisis, it is prudent and appropriate for the agency to take a close look at this. We will continue to press them to do so."
CUNA also backs examination fairness legislation, the Financial Institution Examination Fairness and Reform Act (H.R. 1941/S. 774). The bill would create an independent ombudsman and an independent appeals process for examination disputes.
CUNA and the state leagues also have an ongoing survey that gives credit unions the chance to provide feedback on their most recent examinations by the NCUA or state regulators. The survey helps inform CUNA and the leagues' advocacy efforts.