Tuesday, June 15, 2021

Virtual Exams - A Means of Overseeing CUs 24/7?

 ARLINGTON, Va.–Over the past year reports from most credit unions have been generally positive about the virtual exams NCUA has conducted during the pandemic. But there are increasing concerns by the trade groups that the reach of those exams will be extended and the burden on CUs will get heavier.

“I think there is a lot that remains unknown relative to exams with the continued use of virtual exams,” said Carrie Hunt, EVP and general counsel with CUNA. “The exams had to be virtual due to the pandemic, but whether that translates into longer-term lessons learned from NCUA’s virtual exam program remains to be seen. Certainly, the opportunity to regulate via exams are the kinds of issues that we become concerned about. We want there to be transparency in the process. If NCUA begins doing things in the exam process that are not outlined in their supervisory priorities, then we would we be worried about that.”

Hunt acknowledged that to date the feedback NAFCU has received from its member credit unions has been positive about the virtual exam programs. Moving forward, there remain issues to be addressed, according to Hunt.

‘Flexibility’ Needed

“Part of this is going to depend on whether the credit union has the tools in place to deliver information securely electronically,” said Hunt. “And from NAFCU’s perspective we do not want the virtual exam to turn into a means to examine credit unions 24/7. Credit unions need management flexibility.”

NAFCU recently sent a letter to NCUA urging it to minimize examination burdens by not making requests for model validations.


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