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Joint Guidance on Supervision & Examination Authority Issued

 

Late last week, the federal banking regulators, including NCUA and the Consumer Financial Protection Bureau (CFPB), issued a Supervisory Statement (Statement) regarding enforcement authority over insured banks and credit unions. The Statement is designed to provide clarity and transparency on how and when the Agencies will determine the total amount of assets of an insured depository institution or insured credit union for supervisory and enforcement authorities under Sections 1025 and 1026 of the Dodd- Frank Wall Street Reform and Consumer Protection Act.

The CFPB has exclusive supervisory and primary examination authority over credit unions above $10 billion in assets (Large Institutions), while NCUA retains supervisory and examination authority over credit unions below this amount. According to the Statement, the Agencies will use the total assets as reported on call reports to determine an institution’s asset size. More specifically, the June 30, 2011, call report data will be used to determine a credit union’s asset size initially, as this date is closest to the date that authority for the Federal consumer protection laws was transferred to the CFPB. Thereafter, a credit union will not become a Large Institution unless it has reported total assets of greater than $10 billion in its quarterly Call Report for four consecutive quarters. Similarly, a credit union will not cease to be a Large Institution for such purposes unless it has reported total assets of $10 billion or less in its quarterly Call Report for four consecutive quarters. Click here for the Statement. 

 

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