Thursday, January 9, 2020

NCUA Supervisory Priorities for 2020

The National Credit Union Administration (NCUA) released a letter on its supervisory priorities for 2020.

The primary areas of supervisory focus are:
  • Bank Secrecy Act (BSA)/Anti-Money Laundering (AML);
  • Consumer Financial Protection;
  • Credit Risk Management;
  • Preparation for Implementing Current Expected Credit Losses;
  • Cybersecurity;
  • LIBOR Cessation Planning; and
  • Liquidity Risk
With regard to consumer financial protection, NCUA examiners will be required to review complaince with Electronic Fund Transfer Act (Regulation E), Fair Credit Reporting Act (FCRA), Gramm-Leach-Bliley (Privacy Act), Small dollar lending (including Payday Alternative Lending), Truth in Lending Act (Regulation Z), Military Lending Act (MLA), and Servicemembers Civil Relief Act (SCRA).

The focus on credit risk will place an emphasis on reviewing credit union’s loan underwriting standards and procedures, especially on the ability of borrowers to meet debt service requirements without undue reliance on the value of any collateral. Also, NCUA examiners will closely review credit unions with very high concentrations in specific type of loans.

NCUA further stated it will assess credit unions' exposure to LIBOR and planning related to the discontinuance of LIBOR.

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