Monday, August 25, 2014

Texas Adds S to CAMEL, Where is NCUA?

The Texas Credit Union Department announced in its August newsletter that it will add Sensitivity to market risk (S) to its CAMEL rating system. As a result, the updated rating system now will be referred to as the CAMELS rating system. The revised rating system will be used on all examinations beginning on or after September 1, 2014.

Texas joins credit union regulators for the states of Connecticut, Michigan and Maine, which have added “S” to the CAMEL.

However, not all state credit union regulators are pushing forward with adding S to CAMEL rating system. For example, the Kansas Department of Credit Unions in its third quarter newsletter has decided to wait until NCUA moves forward.

It appears that the ball is in NCUA's court.

NCUA needs to exhibit some leadership and move forward with adding Sensitivity to market risk to its CAMEL ratings system like the other federal banking regulators and state credit union regulators.

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2 comments:

  1. AnonymousAugust 25, 2014 at 7:54 AM

    What market risk is S capturing and what method is used to measure?

    ReplyDelete
  2. Keith LeggettAugust 25, 2014 at 8:39 AM

    Here is a link to the Q&A issued by the Texas CU Department. http://www.cud.texas.gov/upload/file/CAMELS_Questions_and_Answers_(UFIRS).pdf

    ReplyDelete

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