NCUA staff held a virtual town hall meeting last week to provide an update on the agency’s activities and answer questions from participants.
Here are a few highlights from the webinar:
NCUA budget: The Board will approve the 2012 budget on November 17, which is expected to be a “single digit increase.” Chairman Matz stated that NCUA’s recent budget increases, which allow the agency to utilize a 12-month exam cycle and examine all credit unions of at least $250 million, likely saved federally insured credit unions $1.5 billion.
Share Insurance Fund: As expected, there will be no 2011 NCUSIF premium, and the agency’s goal is to not charge a premium in 2012. However, the estimated range for next year’s assessment is 0 - 7 basis points of insured shares. The Board will vote on this at its July meeting. Corporates: Between 2009 and 2011, federally insured credit unions have paid $3.2 billion toward stabilizing the corporate credit union system. The agency’s current estimate of total future costs is $1.8 billion - $6.1 billion. The agency intends to launch a webpage on its site by mid-December that will provide a high- level disclosure of the performance of the assets held by the Asset Management Estates. The agency’s current estimate for the 2012 Corporate Stabilization Fund assessment is 8 - 11 basis points.
• Accounting: NCUA is working on a policy on troubled debt restructurings (TDRs), which will likely be released next month. In response to a question, Larry Fazio, Director of NCUA’s Office of Examination and Insurance, stated that credit unions should not be accruing for Corporate Stabilization Fund assessments, and that the future costs are “not probable and estimable enough” to warrant such accounting treatment.
• Examinations: Fazio indicated that examiners are focusing on concentration risk, due diligence, credit risk management, and interest rate risk. Fazio also mentioned that the agency is currently drafting a National Supervision Policy Manual to replace regional standards with national ones in an effort to increase interoperability among the regions.