Hood outlines updates to examination, supervision program amid pandemic


Chairman Rodney Hood said in a letter to credit unions on Thursday that NCUA is continuing to update its examination and supervision approach amid the COVID-19 pandemic in an effort to “help ensure the safety of personnel and the safety and soundness of the credit union system.”

NCUA, in a March letter to credit unions, initially outlined the agency’s approach to the examination and supervision program for the duration of the COVID-19 pandemic, focusing on three priorities: credit unions experiencing problems, contacting credit unions and conducting examinations offsite.

The most recent letter states that, while NCUA’s priorities remain the same as outlined in the March guidance letter, the agency has updated its approach for conducting examinations offsite, providing information on changes to its examination and supervision approach, which is effective June 1, 2020.

NCUA’s offsite policy for all employees and contracted support staff will remain in effect until further notice and NCUA staff generally will not schedule onsite examination work until further notice, the letter states. However, the agency may conduct onsite work at a credit union if it is necessary to address “serious or time-sensitive matters.”

Hood said the agency will issue reports for examinations completed offsite, but understands that credit unions need to focus on providing uninterrupted service to their members. “Any corrective actions issued to a credit union will consider the impact of the COVID-19 pandemic on the credit union’s operations and financial condition, and will be prioritized appropriately,” Hood said.

Further, examiners will not criticize a credit union’s efforts to provide “prudent relief for members when such efforts are conducted in a reasonable manner with proper controls and management oversight,” but will consider whether the efforts “elevate, or reduce, a credit union’s risk exposure,” the letter states.

However, even if credit unions prudently take on additional risk, it may be reflected in the credit union’s applicable CAMEL and risk ratings.

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