Wednesday, August 24, 2016

Semi-Annual Call Reports Are At Odds With An Extended Exam Cycle

Some comment letters regarding the National Credit Union Administration (NCUA) Call Report Modernization proposal are calling for the NCUA to allow some credit unions to file their call reports semi-annually. The recommendations included some combination of asset size with risk profile.

For example,
  • The Credit Union National Association advocated for eliminating odd-quarter reporting for any credit union below the $50 million asset thresholds that report a net worth ratio above 10 percent.
  • Credit Union of Vermont (Rutland, VT) recommended "semi-annual filings of call reports for low risk credit unions."
  • FIG FCU requested that credit unions with strong net worth ratios be allowed to submit call reports semi-annually.
  • Stuart Lynn wrote that credit unions with CAMEL ratings of 1 - 3 should be required to submit their call reports semi-annually. This recommendation will not take place, as it would divulge information about credit unions that are a problem institutions.
However, these recommendations for less frequent filing of call reports are a step backward.

Prior to July 1, 2002, only credit unions with excess of $50 million in assets were required to submit quarterly call reports. In requiring credit unions to file quarterly call reports, the NCUA Board stated in 2002 that the quarterly filings of call reports were a necessary component of its risk-focused examinations and extending the examination cycle. NCUA believed that the benefits from an extended examination cycle outweigh the costs of filing two additional call reports per year.

Clearly, less frequent filing of call reports are at odds with extending the examination cycle.
Posted by at
Labels: ,

No comments:

Post a Comment

Subscribe to: Post Comments (Atom)
 

The content is provided for educational purposes only, with the understanding that neither the authors, contributors, nor the publishers of this site are engaged in rendering legal, accounting or other expert or professional services. If legal or other expert assistance is required, the services of a competent professional should be sought.

Comments appearing in response to articles appearing on this site do not necessarily reflect the views of the ABA. ABA makes no representations regarding the truth or accuracy of commentary or opinions that may be posted in response to the articles that appear on this website.

The inclusion herein of any link to a website, either in the text of an article or in a comment, does not denote any approval, sponsorship, or endorsement by the ABA, and ABA is not responsible for the content or opinions expressed on those linked websites or related commentary. This content is not licensed to third parties sites and is not affiliated with any third party site. Any reference to the author or this content on any third party site on the Internet is not authorized by the ABA.

It is the policy of the American Bankers Association to comply fully with all antitrust laws. Certain discussions should be considered off-limits, including those that contain competitively sensitive data such as price and cost information, or statements that could be construed as reflecting an attempt or desire to control or influence a particular market or markets. Future pricing or other prospective competitive information should never be shared.