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L-R: Lucy Ito, EVP and COO of the California and Nevada Credit Union Leagues; Dennis Flannigan, CEO of Great Basin FCU; Liz Whitehead, Region V Director for the National Credit Union Administration (NCUA); Dave Gunderson, CEO of Credit Union of Southern California; and Sharon Lindeman, Vice President of Regulatory Advocacy for the Leagues

EXAM, REG ISSUES DISCUSSED WITH NCUA
updated 03/28/14 11:05 AM
Leagues, CEOs Relay Concerns
In a continuing effort to effectively communicate regulatory concerns, representatives from the California and Nevada Credit Union Leagues joined other western state league officials and credit union CEOs in a meeting with National Credit Union Association (NCUA) Regional Director Liz Whitehead (Region V) last week.

Nevada credit unions moved back to Region V from Region I as of Jan. 1, 2013. California credit unions moved back to Region V from Regions II, III, and IV by Jan. 1 of this year.

The Leagues’ representatives included President and CEO Diana Dykstra, Executive Vice President and COO Lucy Ito, and Vice President of Regulatory Advocacy Sharon Lindeman. Joining the Leagues were Dave Gunderson, CEO of Credit Union of Southern California and the Leagues’ Regulatory Advocacy Committee chairman, and Dennis Flannigan, CEO Great Basin FCU.

“The meeting was a tremendous success,” Gunderson said. “Liz Whitehead and her team invested several hours to listen to our comments, perspectives, and recommendations. It was refreshing to discuss the NCUA and credit unions’ common goal of ensuring safety and soundness, as well as some respectful dialog regarding different strategies to achieve this goal.”

Flannigan added: “The meeting entailed good open constructive communication and discussion of the exam survey and other key issues. Liz Whitehead and her senior staff all seemed practical and hesitant to strict oversight without considering the context.”

Lindeman noted that the event provided an “excellent opportunity” for open, collaborative dialogue about regulatory and examination issues. "We appreciate Director Whitehead making time in her schedule to hear our concerns,” Lindeman said.

CUNA Exam Survey Report
The Leagues obtained an advance copy of the CUNA/League 2013 Exam Survey Report, which provided a basis for good dialog, including:

  • Region V exams are improving across the board. This is not true of other regions.
  • Region V attitudes towards exams were improved in 2013 (25 percent were dissatisfied) compared to 2012 (30 percent were dissatisfied). Nationally, there was a slight decline (in 2012, 25 percent were dissatisfied; and in 2013, 27 percent were dissatisfied).
  • Region V credit unions saw a substantial improvement in the use of Documents of Resolutions (DORs) between 2012 (46 percent) and 2013 (39 percent). Nationally, there was little change in examiners’ use of DORs (in 2012, 43 percent; in 2013, 41 percent).
  • Region V exams more closely resemble the exam experience of the other regions, but gaps remain. For example, in 2013, Region V credit unions were 30 percent more likely overall to be cited for one of the five most common exam issues than credit unions in other regions (compared to 38 percent more likely in 2012).

As to the use of DORs, Region V senior staff commented that their objective of the exam modernization and changes to DORs is not to ensure the number reduces, but to ensure the DORs are used for material findings—those that could cause a credit union to fail.

In regard to Region V exam findings, the five most common exam issues included: loan policies, Allowance for Loan Losses (ALL), strategic planning, interest rate risk, and loan concentration. Whitehead said the higher percentage of findings in Region V could simply be a result of the region having a higher percentage of larger credit unions.

The Leagues encourage all California and Nevada credit unions to complete the joint CUNA/League Exam Survey in 2014. The aggregate data will help ensure California and Nevada credit unions’ exam experiences are captured, and any negative trends can be brought to the region’s attention.

Supervision Consistency and Quality Control
In an effort to realize greater consistency across all NCUA regions and in examinations from credit union to credit union, NCUA has adopted two programs since California and Nevada credit unions were previously part of Region V. First, all NCUA examination staff are now guided by the National Supervision Policy Manual (NSPM), the agency’s internal policy for supervisory operations and procedures.

Second, all regions, including Region V, now routinely carry out Quality Control Reviews (QCRs) to specifically identify and address exam inconsistencies. Credit unions that experience quality control issues may contact Region V staff directly or via the Leagues.

Risk-Based Capital
The proposed risk-based capital rule was discussed, including remarks on how an examiner can require even greater capital than the proposed rule sets for an individual credit union.

Whitehead commented that any “individual minimal capital requirements” would have to go through the regional director and to the NCUA board for approval; that such a requirement would not be established by an examiner. In addition, a credit union can appeal the decision.

The Leagues strongly oppose any greater authority for the NCUA to impose additional capital requirements on a case-by-case basis. The Leagues encourage credit unions to review the proposal, the information and resources available on the Credit Union National Association’s (CUNA) website and in PowerComment, and submit a comment letter to NCUA on this and many other concerns with the proposal before the May 28 deadline. The Leagues also encourage credit unions to register for and attend NCUA Chairman Debbie Matz’s June 26 “Listening Session” in Los Angeles. Due to space constraints, registration is limited to 150 people.

Also, click here to access CUNA’s Risk-Based Capital Action Center.

 
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METSGER APPOINTED NCUA BOARD CHAIR updated 05/02/16 05:17 PM
Plus, CFPB on Arbitration and TRID
President Barack Obama has appointed National Credit Union Administration (NCUA) Vice Chairman Rick Metsger to be the ninth chairman of the NCUA Board of Directors, succeeding outgoing Board Chairman Debbie Matz, whose service ended April 30.

TV INVESTIGATION SPOTLIGHTS 'PACE' updated 05/02/16 02:39 PM
Protecting Consumers Becomes Crucial
A TV news station in Los Angeles has captured a clear example of consumer protection issues stemming from the “PACE” lending program (Property Assessed Clean Energy) in just one instance of how it is proving financially harmful to homeowners and credit union members across California.

'PACE' PASSES FIRST STATE COMMITTEE updated 04/26/16 08:48 AM
Congressman Sherman Gives Support
In a rare instance of federal and state legislative involvement, Assembly Bill 2693, authored by Assemblyman Matt Dababneh (D-Encino), received two significant boosts yesterday.

INDUSTRY LEADER AND MENTOR PASSES updated 04/25/16 12:43 PM
O'Rourke 'Will be Missed'
Gene O’Rourke—who left a 40-year legacy of helping shape and place leaders in the credit union industry throughout California and the nation—died this past Friday. He was 70.

LEAGUES COMMENT ON OTR, FEE METHODS updated 04/25/16 04:12 PM
Plus, NCUA's 2 New Proposals
The California and Nevada Credit Union Leagues have told the National Credit Union Administration (NCUA) that federally insured state-chartered credit unions (FISCUs) and federally chartered credit unions (FCUs) should be treated equitably in their comment letter on the Overhead Transfer Rate (OTR) and Operating Fee Schedule Methodologies.

REG COMMITTEE RESPONDS TO CORDRAY updated 04/19/16 09:31 AM
CU Leaders Express Opinions
In Consumer Financial Protection Bureau Director (CFPB) Richard Cordrary’s recent response to a congressional letter that calls on him to fully utilize the bureau’s exemption authority for community financial institutions, Cordray cites examples of how the bureau has already used this authority.

NCUA SELECTS NEW REGION V DIRECTOR updated 04/19/16 07:31 AM
Plus: Proposed Rules; Comments Needed
The National Credit Union Administration (NCUA) has selected Cherie Freed as regional director of the agency’s Region V office in Tempe, AZ. She will replace current Regional Director Elizabeth Whitehead, who will retire in May after 28 years of service.

AUTOS MAY PEAK AT 18 MILLION IN 2017 updated 04/19/16 05:40 PM
Decisive Moment for Credit Unions
Credit unions’ speedy, record breaking growth in auto lending might peel even more rubber in 2017. But how will they handle a plateau and subsequent drop in sales when the current business cycle runs its course?

RESPECTED ECONOMIST DIES AT 63 updated 04/14/16 04:38 PM
Esmael Adibi on SchoolsFirst Board
A beloved and well-respected forecaster on the California economy over the past 38 years—as well as credit union board member of SchoolsFirst FCU—died of complications from a stroke on April 8.

ADVOCACY IN FULL SWING AFTER 'GRR' updated 04/12/16 08:51 AM
Upcoming Committee Meeting on PACE
Credit union advocates may have left Sacramento last week after the 2016 California Government Relations Rally (GRR) came to a close, but state legislative efforts on a number of issues remain in full swing as the industry continues fighting for its members.

NV CUs SPECIFIED IN SENATE HEARING updated 04/11/16 01:50 PM
More Action is Forthcoming
In the California and Nevada Credit Union Leagues’ continual push for the Consumer Financial Protection Bureau (CFPB) to fully use its exemption authority for credit unions, Nevada credit unions were specifically discussed by Sen. Dean Heller (R-NV) during the first of two hearings last week regarding the CFPB’s impact.

MODERNIZATION BILL MOVES TO ASSEMBLY updated 04/05/16 09:24 AM
CA Gov. Relations Rally Kicks Off
Sacramento is front and center for credit union advocacy this week as two powerful events unfold that are integral to the cause of the industry and its members across California: the state-charter modernization bill and the 2016 California Government Relations Rally (GRR).

SACTOWN RAISES NEARLY $200K FOR CMN updated 04/05/16 09:03 AM
Benefits CA/NV Children's Hospitals
The sixth annual Credit Union SacTown Run—which took place Sunday, April 3 in downtown Sacramento, CA—raised nearly $200,000 for Children’s Miracle Network hospitals in California and Nevada. The event was sponsored by CU Miracle Day, Inc. along with 69 credit unions and credit union businesses including the California and Nevada Credit Union Leagues.

CFO: INSIGHT ON FASB's 'TRG' MEETING updated 04/05/16 08:54 AM
Current Expected Credit Loss
On April 1, the Financial Accounting Standards Board (FASB) met with its Transition Resource Group (TRG) on the proposed accounting standards update (ASU) for credit losses, which would implement a forward-looking Current Expected Credit Loss (CECL) model.

EVENT WILL LAUNCH DYNAMIC DISCUSSION updated 04/04/16 04:24 PM
'Your Economy, Your Credit Union'
Credit unions can join their peers from across California and Nevada to engage with three renowned experts on June 16 during "Your Economy—Your Credit Union: 2017 and Beyond," a first event of its kind!

CUs PREPARE TO UNITE IN SACRAMENTO updated 03/29/16 09:31 AM
Register for 'GRR' Today
All credit union advocates are needed in Sacramento as momentum builds toward the 2016 California Government Relations Rally (GRR) from April 4-5, where executives, managers, and board volunteers will discuss important topics with state lawmakers to help protect credit unions and allow their members to thrive.

GROUP TO PROVIDE FEEDBACK ON 'CECL' updated 03/29/16 08:11 AM
Two CUs Part of Discussion
Two credit union CFOs will be a part of a key meeting this week leading up to the Financial Accounting Standards Board’s (FASB) expected mid-2016 decision on its proposed accounting standards update (ASU) on credit-losses standard.

FOUNDATION RECEIVES DIAMOND AWARDS updated 03/25/16 10:49 AM
Efforts Leveraging Video & Financial
The National Credit Union Foundation (the Foundation) was honored with two Diamond Awards—awards that recognize outstanding marketing and business development achievements in the credit union industry.

CONSUMER PROTECTION ADDED TO BILL updated 03/21/16 10:46 AM
'PACE' Momentum Heats Up
A significant amendment was made last week to Assembly Bill 2693 to address the huge consumer protection issues surrounding Property Assessed Clean Energy (PACE) programs that credit unions in California and their members have begun to encounter.

WINE AUCTION RAISES 1M FOR CMN KIDS updated 03/21/16 09:07 AM
$4.8 Million Since 2006
For the second year in a row, the annual Credit Unions for Kids Wine Auction raised more than $1 million for the 11 Children’s Miracle Network Hospitals in California and Nevada.

CUNA: BYLAW MODERNIZATION APPOVED updated 03/21/16 01:59 PM
Membership Votes for Open Model
More than 90 percent of participating Credit Union National Association (CUNA) members (representing more than 43 percent of total membership) has voted to modernize the association’s bylaws, which will create a new, open membership model for CUNA and empowers the board of directors to maintain a fair dues formula and board structure.

NCUA'S WHITEHEAD MEETS WITH LEADERS updated 03/18/16 04:03 PM
Region V Responds to Concerns
Last week representatives from the California and Nevada Credit Union Leagues met with National Credit Union Administration (NCUA) Region V Director Liz Whitehead and Associate Regional Directors Mike Dyer and Cherie Freed.

329 CONGRESSMEN TO CFPB: EXEMPT CUs updated 03/14/16 01:22 PM
Letter Co-Authored by Rep. Schiff
A letter co-written by California Rep. Adam Schiff, D-Los Angeles, and Rep. Steve Stivers, R-Ohio, asking for the Consumer Financial Protection Bureau (CFPB) to fully exercise its rule-making exemption authority for community based financial institution recently was submitted to CFPB Director Richard Cordray.

PLEASE SEND LETTER TO FASB ON 'CECL' updated 03/11/16 10:40 AM
CUs Urged to Act
Credit union leaders are urged to assist in the grassroots efforts initiated by the California and Nevada Credit Union Leagues’ to oppose the Financial Accounting Standards Board’s (FASB) proposed accounting standards update (ASU) on credit losses.