Credit Union Exam Solutions Presents With Flying Colors

Set up a call:https://calendly.com/cuexamsolutions/talk-to-mark-about-any-exam-topic?month=2024-10Check out our website:https://calendly.com/cuexamsolutions/talk-to-mark-about-any-exam-topic?month=2024-10Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.Hire us and gain:• Peace of mind during your exam process• Insider knowledge of NCUA procedures and expectations• Strategies to address potential issues before they become problems• Continuous access to our extensive subject matter expertiseWith our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union passers its exam with flying colors in its next examination.Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.In this episode, Mark Treichel is joined by Government Affairs Practitioner John McKechnie, his colleague back in NCUA. Aside from catching up, they also discuss the latest financial proceedings being discussed by Congress today in regard to NCUA. They delve into the attacks of banks to credit unions, vendor authority, CLF, CFB, and the climate-related financial risk from NCUA. Mark and John also discuss their thoughts on how Capitol Hill might attempt to look for a new financial vehicle, only to tack it onto trade associations in the credit union industry.

Set up a call:https://calendly.com/cuexamsolutions/talk-to-mark-about-any-exam-topic?month=2024-10Check out our website:https://calendly.com/cuexamsolutions/talk-to-mark-about-any-exam-topic?month=2024-10Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.Hire us and gain:• Peace of mind during your exam process• Insider knowledge of NCUA procedures and expectations• Strategies to address potential issues before they become problems• Continuous access to our extensive subject matter expertiseWith our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union passers its exam with flying colors in its next examination.Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.Each March, the NCUA releases its Annual Report, summarizing the agency’s performance in meeting its strategic goals and objectives. As usual, this year’s report makes for an interesting read, particularly given the industry’s recent volatility.At the outset, the NCUA should be commended for putting together such a comprehensive, accessible, and intelligent presentation. Last year’s Annual Report won the prestigious Certificate of Excellence in Accounting Reporting award from the Association of Government Accountants. It would not be a surprise if this year’s presentation is a repeat winner. The document is laid out smartly and packed with information.Overall, the NCUA’s focus in 2022 concerned five broad categories:· Responding to evolving economic and financial challenges;· Strengthening the credit union system’s capital levels;· Increasing cyber resiliency;· Supporting small credit unions and minority depository institutions; and· Fostering greater diversity, equity, inclusion and belonging.Join this conversation today as Mike Macchiarola of Olden Lane offers his analysis on the key takeaways from the NCUA Annual Report.

Set up a call:https://calendly.com/cuexamsolutions/talk-to-mark-about-any-exam-topic?month=2024-10Check out our website:https://calendly.com/cuexamsolutions/talk-to-mark-about-any-exam-topic?month=2024-10Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.Hire us and gain:• Peace of mind during your exam process• Insider knowledge of NCUA procedures and expectations• Strategies to address potential issues before they become problems• Continuous access to our extensive subject matter expertiseWith our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union passers its exam with flying colors in its next examination.Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.I started this podcast 15 months ago not knowing how it would do or how long it would last. Last month we had 2,000 downloads and today we are celebrating our 100th episodes.THANK YOU LISTENERS!!!In 33 years at NCUA I served as Executive Director, Regional Director, Director of Special Actions, Supervisory Examiner, and Principal Examiner. I began at the ground level as an examiner. I rose to the top. As Executive Director I supervised your Regional Director. I know how NCUA thinks and why they think it. I know the examination process inside and out. I know how to communicate and negotiate with NCUA. I know how to get NCUA to YES instead of NO. I can help if you are currently dealing with or thinking about:An examination that did not go as well as you hopedAn Examination that is in process right nowAn examination that is coming soonResponding to an NCUA or state examinationAssessing a letter to you from your Regional Director or State RegulatorSeeking NCUA or State Regulator approval for an action you desire to takeAssessing actions you will take in response to a Document of ResolutionReceiving a Letter of Understanding and AgreementDocument of Resolution (DOR) IssuesExaminer FindingsSupplementary FactsCAMEL Code DowngradesCapital AdequacyAsset QualityManagement CodeEarningsLiquidity CodeSensitivity CodeCommercial Lending MBL IssuesInterest Rate Risk (IRR)Net Economic Value (NEV)Secondary CapitalSubordinated DebtExit Conference / Joint Conference ChallengesFair Lending Exam IssuesField of Membership (FOM) ExpansionsCECL IssuesAppealsReputation RiskNet Worth Restoration Plans (NWRP)Credit riskInterest rate riskLiquidity riskTransaction riskStrategic riskReputation riskCompliance riskNCUA's Large Credit Union ProgramTransition to the Office of National Examinations and Supervision (ONES)CFPBStrategic PlanningSafety and SoundnessSupervisory CommitteeCorporate GovernanceBank Secrecy Act (BSA)NCUA Examination PrioritiesNCUA's Examination GuideNational Supervision Policy ManualBank PurchasesLetters to Credit UnionsNCUA Regulations Reach out today to discuss how I can assist you and your credit union.

Set up a call:https://calendly.com/cuexamsolutions/talk-to-mark-about-any-exam-topic?month=2024-10Check out our website:https://calendly.com/cuexamsolutions/talk-to-mark-about-any-exam-topic?month=2024-10Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.Hire us and gain:• Peace of mind during your exam process• Insider knowledge of NCUA procedures and expectations• Strategies to address potential issues before they become problems• Continuous access to our extensive subject matter expertiseWith our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union passers its exam with flying colors in its next examination.Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.Review of the Federal Reserve’s Supervision and Regulation of Silicon Valley Bank Silicon Valley Bank (SVB) failed because of a textbook case of mismanagement by the bank. Its senior leadership failed to manage basic interest rate and liquidity risk. Its board of directors failed to oversee senior leadership and hold them accountable. And Federal Reserve supervisors failed to take forceful enough action, as detailed in the report. Our banking system is sound and resilient, with strong capital and liquidity. And in some respects, SVB was an outlier because of the extent of its highly concentrated business model, interest rate risk, and high level of reliance on uninsured deposits; however, SVB’s failure demonstrates that there are weaknesses in regulation and supervision that must be addressed. Regulatory standards for SVB were too low, the supervision of SVB did not work with sufficient force and urgency, and contagion from the firm’s failure posed systemic consequences not contemplated by the Federal Reserve’s tailoring framework. Following SVB’s failure, we must strengthen the Federal Reserve’s supervision and regulation based on what we have learned. This report represents the first step in that process—a self-assessment that takes an unflinching look at the conditions that led to the bank’s failure, including the role of Federal Reserve supervision and regulation.Individuals who were not involved in the supervision of SVB conducted the review, and I oversaw it. The four key takeaways of the report are:1.     Silicon Valley Bank’s board of directors and management failed to manage their risks.2.     Supervisors did not fully appreciate the extent of the vulnerabilities as Silicon Valley Bank grew in size and complexity.3.     When supervisors did identify vulnerabilities, they did not take sufficient steps to ensure that Silicon Valley Bank fixed those problems quickly enough.4.     The Board’s tailoring approach in response to the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA) and a shift in the stance of supervisory policy impeded effective supervision by reducing standards, increasing complexity, and promoting a less assertive supervisory approach. 

Set up a call:https://calendly.com/cuexamsolutions/talk-to-mark-about-any-exam-topic?month=2024-10Check out our website:https://calendly.com/cuexamsolutions/talk-to-mark-about-any-exam-topic?month=2024-10Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.Hire us and gain:• Peace of mind during your exam process• Insider knowledge of NCUA procedures and expectations• Strategies to address potential issues before they become problems• Continuous access to our extensive subject matter expertiseWith our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union passers its exam with flying colors in its next examination.Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

Set up a call:https://calendly.com/cuexamsolutions/talk-to-mark-about-any-exam-topic?month=2024-10Check out our website:https://calendly.com/cuexamsolutions/talk-to-mark-about-any-exam-topic?month=2024-10Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.Hire us and gain:• Peace of mind during your exam process• Insider knowledge of NCUA procedures and expectations• Strategies to address potential issues before they become problems• Continuous access to our extensive subject matter expertiseWith our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union passers its exam with flying colors in its next examination.Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.Ryan Donovan is the President of the Council of Federal Home Loan Banks.The Council is dedicated to enhancing public awareness and understanding of the Federal Home Loan Bank System. It is the primary public voice of the FHLBank System and its function is to represent the positions and views of its members to Washington, DC policymakers. The FHLBank System was created by the Federal Home Loan Bank Act of 1932 as a government sponsored enterprise to support mortgage lending and community investment. The System is composed of 11 regional banks which are privately capitalized and owned as cooperatives by their members. Their regional distribution enables each bank to focus on the distinct needs of their individual communities.While only financial institutions may belong to a FHLBank, people everywhere benefit from them. Each year, the FHLBanks provide access to billions of dollars in low-cost funding to approximately 6,600 of America’s banks, credit unions, insurance companies and community development financial institutions. Without access to FHLBank advances, most members would find it difficult to support lending within their community. FHLBanks carry out their core mission of providing liquidity by raising funds in the global financial markets, then lending that money in the form of “advances” (loans) to members and local communities. Each FHLBank is operated independently and receives no taxpayer assistance. Each bank is registered with the SEC and is supervised and regulated by the Federal Housing Finance Agency (FHFA). The Office of Finance serves as the fiscal agent for the FHLBanks.   The new paper from Jim Parrott and Mark Zandi is an opening salvo in what will likely be a high-stakes battle over the future of the lenders. The FHLB system has come under fire in recent weeks for loans made to now-collapsed financial institutions Silicon Valley Bank, Signature Bank and Silvergate Capital Corp.  FHLB loans come with favorable interest rates due to implied US government backing, despite the banks being cooperatives owned by financial institutions. Critics say they can encourage risky behavior by financial firms.However, Parrott, a former Obama administration housing adviser, and Zandi, chief economist at Moody’s Analytics, said on Tuesday that the FHLBs are vital sources of liquidity for financial institutions and act as a “first responder” in crises. If anything, the system should be expanded, they said in an Urban Institute paper. “Without the FHLBs, these downturns in the economic cycle would have been significantly more painful, with greater swings in the cost and availability of credit, exacting greater damage on the economy,” they wrote.  Week of SVB: The Federal Home Loan Bank System issued $304 billion in debt last week, according to a person familiar with the matter, who asked not to be identified discussing non-public data.That’s almost double the $165 billion that liquidity-hungry lenders tapped from the Federal Reserve. The  Next to Last Resort

Set up a call:https://calendly.com/cuexamsolutions/talk-to-mark-about-any-exam-topic?month=2024-10Check out our website:https://calendly.com/cuexamsolutions/talk-to-mark-about-any-exam-topic?month=2024-10Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.Hire us and gain:• Peace of mind during your exam process• Insider knowledge of NCUA procedures and expectations• Strategies to address potential issues before they become problems• Continuous access to our extensive subject matter expertiseWith our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union passers its exam with flying colors in its next examination.Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.The first half of 2022 experienced the sharpest increase in interest rates in decades.1 A sharp rise in interest rates may amplify market risk exposure to earnings and capital. This occurs because a credit union’s assets and liabilities do not reprice equally or concurrently. This timing (or duration) mismatch, combined with a sharp rise in interest rates, may result in sharply lower net economic values (NEV) as measured using the NCUA’s NEV Supervisory Test (NEV Test) or the Estimated NEV Tool (ENT).This letter revises the risk management expectations for credit unions over $50 million in assets described in Letter to Federally Insured Credit Unions 16-CU-08, Revised Interest Rate Risk (IRR) Supervision, effective January 1, 2017. This letter provides additional information and updates to the NCUA’s supervisory framework of interest rate risk (IRR).2Due to the changing economic and interest rate environments during 2022, the NCUA reviewed the parameters and risk classifications of the NEV Test and overall IRR supervisory framework. As a result of this review, several updates are being made with the issuance of this letter. Part II of this letter describes these changes in more detail.In summary, these changes include:Revising the risk classifications by eliminating the extreme risk classification and modifying the high risk classification;Clarifying when a Document of Resolution (DOR) to address IRR is warranted, including removing any presumed need for a DOR based on an IRR supervisory risk classification and related need for a credit union to develop a de-risking plan;Providing examiners more flexibility in assigning IRR supervisory risk ratings; andRevising examination procedures to incorporate updated review steps when assessing how a credit union’s management of IRR is adapting to changes in the economic and interest rate environment.Exam staff should refer to the Examiner’s Guide for more information on examining and supervising IRR. If there is a conflict between the National Supervision Policy Manual (NSPM), the Examiner’s Guide, and this letter, exam staff must rely on this letter until the NSPM, and Examiner’s Guide are updated.3 This letter is intended to supplement existing resources on the supervision of IRR; it does not replace or supersede applicable laws and regulation.Exam staff must remember that IRR is a major area of risk and, under certain market conditions, may expose credit unions to other related issues, such as liquidity risk, asset quality deterioration, unexpected losses to earnings, capital erosion, and strategic risk. The credit union system has experienced significant growth in complexity over the past two years with total assets growing by approximately 25 percent. As the system has grown, concentrations in longer maturity assets have significantly increased sensitivity to changes in interest rates.4If you have any questions regarding the changes detailed in this letter, please direct them to your immediate supervisor.I. BackgroundReview of a credit union’s IRR exposure has been a long-standing supervisory priority and part of the NCUA’s supervision program. Over the past decade, the NCUA has enhanced examination tools and issued periodic updates related to IRR for both staff and credit unions.In 2012, the NCUA updated section 741.3(b) of the NCUA regulations to require credit unions with assets greater than $50 million to maintain a written policy and an effective IRR management program as part of asset liability management.5 The regulation includes Appendix A, which provides guidance for an IRR policy and an effective program.The NCUA finalized derivatives rules providing more flexibility for federal credit unions to manage IRR in 2014 and revised the rules in 2021.6 The 2021 rule modernized the use of derivatives with a principles-based approach while retaining key safety and soundness components.

Set up a call:https://calendly.com/cuexamsolutions/talk-to-mark-about-any-exam-topic?month=2024-10Check out our website:https://calendly.com/cuexamsolutions/talk-to-mark-about-any-exam-topic?month=2024-10Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.Hire us and gain:• Peace of mind during your exam process• Insider knowledge of NCUA procedures and expectations• Strategies to address potential issues before they become problems• Continuous access to our extensive subject matter expertiseWith our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union passers its exam with flying colors in its next examination.Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.Mike Bell of Honigman LLC was recently interviewed by Ken McCarthy of American Banker: The Polarizing Question of Credit Unions Buying Banks.Bell is the GURU of bank acquisitions. We discuss current trends on this topic and more.

Set up a call:https://calendly.com/cuexamsolutions/talk-to-mark-about-any-exam-topic?month=2024-10Check out our website:https://calendly.com/cuexamsolutions/talk-to-mark-about-any-exam-topic?month=2024-10Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.Hire us and gain:• Peace of mind during your exam process• Insider knowledge of NCUA procedures and expectations• Strategies to address potential issues before they become problems• Continuous access to our extensive subject matter expertiseWith our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union passers its exam with flying colors in its next examination.Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.With Liquidity becoming a bigger priority every day we are today's episode is a from the recent archive and discusses how to deal with NCUA on liquidity issues, practical advice, and the FHLB.In 33 years at NCUA I served as Executive Director, Regional Director, Director of Special Actions, Supervisory Examiner, and Principal Examiner. I began at the ground level as an examiner. I rose to the top. As Executive Director I supervised your Regional Director. I know how NCUA thinks and why they think it. I know the examination process inside and out. I know how to communicate and negotiate with NCUA. I know how to get NCUA to YES instead of NO. I can help if you are currently dealing with or thinking about:An examination that did not go as well as you hopedAn Examination that is in process right nowAn examination that is coming soonResponding to an NCUA or state examinationAssessing a letter to you from your Regional Director or State RegulatorSeeking NCUA or State Regulator approval for an action you desire to takeAssessing actions you will take in response to a Document of ResolutionReceiving a Letter of Understanding and AgreementDocument of Resolution (DOR) IssuesExaminer FindingsSupplementary FactsCAMEL Code DowngradesCapital AdequacyAsset QualityManagement CodeEarningsLiquidity CodeSensitivity CodeCommercial Lending MBL IssuesInterest Rate Risk (IRR)Net Economic Value (NEV)Secondary CapitalSubordinated DebtExit Conference / Joint Conference ChallengesFair Lending Exam IssuesField of Membership (FOM) ExpansionsCECL IssuesAppealsReputation RiskNet Worth Restoration Plans (NWRP)Credit riskInterest rate riskLiquidity riskTransaction riskStrategic riskReputation riskCompliance riskNCUA's Large Credit Union ProgramTransition to the Office of National Examinations and Supervision (ONES)CFPBStrategic PlanningSafety and SoundnessSupervisory CommitteeCorporate GovernanceBank Secrecy Act (BSA)NCUA Examination PrioritiesNCUA's Examination GuideNational Supervision Policy ManualBank PurchasesLetters to Credit UnionsNCUA Regulations Reach out today to discuss how I can assist you and your credit union.

Set up a call:https://calendly.com/cuexamsolutions/talk-to-mark-about-any-exam-topic?month=2024-10Check out our website:https://calendly.com/cuexamsolutions/talk-to-mark-about-any-exam-topic?month=2024-10Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.Hire us and gain:• Peace of mind during your exam process• Insider knowledge of NCUA procedures and expectations• Strategies to address potential issues before they become problems• Continuous access to our extensive subject matter expertiseWith our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union passers its exam with flying colors in its next examination.Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.Link to Whitehouse "fact" sheet:https://www.whitehouse.gov/briefing-room/statements-releases/2023/03/30/fact-sheet-president-biden-urges-regulators-to-reverse-trump-administration-weakening-of-common-sense-safeguards-and-supervision-for-large-regional-banks/President Biden believes that resilient community and regional banks provide vital services to small businesses, workers, and families around the country. The Biden-Harris Administration has taken decisive action to ensure the stability of the banking system without putting taxpayer dollars at risk. As we have demonstrated, the administration has the tools to act quickly to prevent contagion and is committed to taking strong action if needed. Americans should have confidence that their deposits will be there when they need them.As the President said when his administration announced actions to stabilize the banking system, he is committed to “continuing our efforts to strengthen oversight and regulation of larger banks so that we are not in this position again.” The Obama-Biden Administration put in place strong requirements – primarily through the Dodd-Frank Act and subsequent regulations and supervision – to reduce the risk of future banking crises. Unfortunately, Trump Administration regulators weakened many important common-sense requirements and supervision for large regional banks like Silicon Valley Bank and Signature Bank, whose recent failure led to contagion.The President believes that the weakening of common-sense bank safeguards and supervision during the Trump Administration for large regional banks should be reversed in order to strengthen the banking system and protect American jobs and small businesses.Specifically, the President urges the federal banking agencies, in consultation with the Treasury Department, to consider a set of reforms that will reduce the risk of future banking crises, including:Reinstating rules that were rolled back in the previous Administration for banks with assets between $100 and $250 billion, including:Liquidity requirements and enhanced liquidity stress testing. Liquidity rules originally created under the Dodd-Frank Act required banks with between $100 and $250 billion in assets to hold sufficient high-quality liquid assets to cover expected net outflows during a stress period. The Trump Administration eliminated these rules for banks below $250 billion in assets. A recent analysis found that, as of the end of 2022, Silicon Valley Bank was well below the liquidity threshold that would have applied had the Trump Administration not exempted the bank from those rules. As we just saw, Silicon Valley Bank’s liquidity stress contributed to its failure and quickly transmitted to other banks. Bank regulators are encouraged to consider reinstating these requirements and using rigorous liquidity stress tests that factor in the risks of faster withdrawals in an always-on online environment.Annual supervisory capital stress tests. Federal banking authorities have undertaken comprehensive capital stress tests to evaluate a range of risks that could face banks and to require that banks clearly have enough capital to withstand the potential losses associated with those risks. Under the Trump Administration, regulators reduced the obligation for banks like Silicon Valley Bank to undergo these stress tests from once a year to once every two years. As a result, when Silicon Valley Bank failed, it had never undergone a comprehensive capital stress test even though it had more than $200 billion in assets. Concerns about the bank’s capital levels contributed to a loss of confidence and withdrawal of deposits.