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Survey: One-quarter of credit unions dissatisfied with state, federal exam processes

Bill Hampel

Bill Hampel

A recent survey by the Credit Union National Association found that 25 percent of credit union CEOs are dissatisfied with their federal and state exam processes, while 60 percent indicated that they were satisfied.

“The rate of dissatisfaction is never going to be zero, but it would be nice to move in that direction,” CUNA Chief Economist Bill Hampel said, according to Credit Union Times.

Credit unions that reported dissatisfaction were also more likely to be state-chartered credit unions with more than $250 million in assets, which makes them subject to joint exams. Dissatisfied credit unions were also often under-capitalized, leading their examiner to assign a riskier rating after the exam was completed.

Respondents who indicated a negative opinion about the exam process said that increased regulatory requirements and exam requirements have put a substantial burden on credit union resources, Credit Union Times reports.

Credit unions that indicated satisfaction with their exams were often state-chartered and not subject to joint exams that resulted in improved ratings after the exam.

The survey also found that 43 percent of respondents received at least one DOR during their last exam. While CUNA was previously only able to provide anecdotal feedback to the National Credit Union Administration, CUNA Deputy Counsel Mary Dunn said that the ability to quantify the use of the documents will be essential as it works to reduce DOR use.

“The biggest weakness in any advocacy program is a lack of actual information and hard fast data that substantiates your claim,” Dunn said, according to Credit Union Times. “This allows us to sit down with regulators and show them what the data indicates, that there are too many DORs out there.”

Dunn also praised the NCUA for its willingness to make improvements to the exam process, saying that the NCUA has implemented ideas faster than her agency can develop them.

“We’re in a different place this year compared to last year, with the agency recognizing that improvements need to be made, and embarking upon those improvements,” Dunn said, Credit Union Times reports. “But, so long as the economy is still improving, we will still have exam issues.”

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