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TIPs Bulletins
The Technical Information Procedure (TIPs) bulletins are great tools to help credit union staff understand recent changes in laws and regulations and how they may affect the credit union. TIPs bulletins address current mandatory compliance issues and changes to federal and state regulations. Continue for complete list of current TIPs Bulletins
March 25, 2015
TIPs Bulletin #15-06 Foreign Language Translation Forms Revisions
TIPs Bulletin #15-05 NCUA Issues Warning to Consumers about “National Credit Union” Phishing Scam
January 28, 2015
TIPs Bulletin #15-04 2014 Residential Mortgage Loan Report
TIPs Bulletin #15-03 HMDA/LAR Reports
January 16, 2015
TIPs Bulletin #15-02 2015 Information Returns and Disclosures
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From the Editors of CU Weekly

L-R: National Credit Union Administration Regional Directors Liz Whitehead (Region V) and Jane Walters (Region II)
updated 04/06/13 09:11 AM
Leagues Relay CU Concerns
In a continuing effort to effectively communicate California and Nevada credit unions' regulatory concerns, representatives from the California and Nevada Credit Union Leagues met with National Credit Union Association (NCUA) Regional Directors Liz Whitehead (Region V) and Jane Walters (Region II) last week in two separate league dialogues. Nevada credit unions moved back to Region V from Region I as of Jan. 1; California credit unions remain in Region II.

Leagues Senior Vice President of Advocacy Bob Arnould and Vice President of Regulatory Advocacy Sharon Lindeman joined other state leagues’ representatives in the two regional dialogues with NCUA staff.

"Both events provided an excellent opportunity for open, collaborative dialogue about regulatory and examination issues," Lindeman said. "We appreciate Director Walters and Director Whitehead making time in their schedules to hear our concerns."

Documents of Resolution (DORs)
NCUA's issuance of Documents of Resolution (DORs) was a hot topic. NCUA Region II (CA) staff said managers will receive training next week regarding the type and materiality of issues constituting a DOR, although they were unable to confirm when California field examiners will receive the training. Region V (NV) staff agreed that only material findings—those that could cause a credit union to fail —should be included in a DOR.

NCUA has proposed changes to its internal DOR form, which it hopes will improve consistency in use, as well as make the form shorter to improve clarity and provide better reporting data. The revised DOR form is slated to be in use sometime between late 2013 and early 2014.

'Best Practices' and Other Exam Issues
A recurring theme expressed by state league representatives was that examination findings are not always based on regulations, but sometimes on "best practices" instead. Whitehead explained that examiners are in a position to identify best practices and it is prudent to share those as recommendations with credit unions; however, findings should cite regulations.

NCUA staff said they strive to work cooperatively with state regulators and indicated they meet with the National Association of State Credit Union Supervisors (NASCUS) twice per year. In response to statements that credit unions feel their state regulators acquiesce to NCUA, it was discussed that differences can be raised to the director level for resolution and that NCUA and state regulators reach an agreement 90 percent of the time.

When asked what constitutes an insurance review by NCUA, Region V (NV) staff said there is no clarifying document. The NCUA review is based on risk, and the agency will focus on those risk elements, including interest rate risk, credit risk, and other types.

In response to questions raised about Letter to Federal Credit Unions, 13-FCU-02—and fair lending exams—NCUA staff said fair lending exams are conducted out of its central office, but regional offices may assist in the process.

League Dues and California’s Return to Region V
A state league representative shared that when examiners instruct credit unions to cut expenses, they include cutting league dues expenses. Walters and her staff (Region II – CA) emphatically said examiners are told not to suggest credit unions eliminate league dues, and added that NCUA recognizes the importance of league support to credit unions.

When asked about California credit unions' return to Region V, Walters and Whitehead said the transfer should occur by the end of 2013 or early 2014.

2013 Examination Focus
Both directors addressed their exam focus for 2013. NCUA’s Letter to Credit Unions, 13-CU-01, outlines the agency's supervisory focus for the year, which credit unions should refer to.

There was also discussion regarding:

  • Loan portfolio risk—credit unions should ensure they manage and monitor their loan portfolio and concentration risk.
  • Member business loans (MBL)—credit unions should have proper staff expertise, appropriate underwriting, cash-flow analysis, policies and procedures, and monitoring during the life of the loan.
  • Collection programs—credit unions should ensure they have effective collection programs.
  • Asset liability management (ALM)—this will be an issue over the next few years due to interest rate and liquidity risks.

Future Guidance, Recent Trends, and 'Small' CUs
The NCUA is providing guidance this year regarding several issues to help improve clarity. League representatives requested the agency include guidance to credit unions regarding concentration risk, recognizing that concentration risk is more than just percent of net worth—it includes understanding the various loan types in portfolio and the aggregate concentration.

When asked what trends examiners are seeing, Walters (Region II – CA) indicated a need for effective credit union board and supervisory committee training, as well as proper succession planning. Whitehead (Region V – NV) said her staff is also noticing internal fraud issues.

In response to an observation in the CUNA-League Exam Survey that Region V is 6 to 13 percent more likely to receive examination findings than all other regions combined, Region V (NV) NCUA staff said they would need to look deeper into the survey results to fully understand that statistic. However, their initial response is that “sand states” experienced more challenges and issues over the past few years and the region has a higher number of large, complex credit unions.
Prior to revising the "small credit union" threshold from $10 million to $50 million in assets, NCUA said exams for small credit unions with a code 1 or code 2 would be a maximum of 40 hours. Lindeman asked whether the 40-hour rule now applies to credit unions with assets of up to $50 million. NCUA responded that this practice still only applies to credit unions under $10 million in assets, and that credit unions greater than $10 million require more hours. Essentially, the new definition of a "small credit union" does not change past exam procedures.

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updated 03/23/15 02:08 PM
Plus, NCUA Webinar, Video Series
The Consumer Financial Protection Bureau (CFPB) has published updated TILA-RESPA regulatory implementation materials. Click here to view the updates.

Click to view the complete story

updated 03/17/15 07:58 AM
Foreign Bank Money Laundering Concern
A recent Consumer Financial Protection Bureau (CFPB) study indicated that arbitration agreements restrict consumers’ relief for disputes with financial service providers by limiting class actions. The CFPB has been studying arbitration clauses in a number of different consumer finance markets since 2012.

Click to view the complete story

D.J.'s Economix
Leagues Chief Economist Dwight Johnston continually provides economic and market analysis that is both informative and entertaining. Continue for daily and monthly commentary, rate forecasts, and economic updates.
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