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NCUA launches enhanced supervisory effort
ALEXANDRIA, Va. (1/9/09)--The National Credit Union Administration (NCUA) activated its National Examination Team (NET) Thursday, an effort meant to respond to current market difficulties facing credit unions. The NET was announced in October as part of the NCUA's budget process and is in response to difficulties caused by declining home values, high mortgage delinquency rates, high foreclosure rates, high unemployment rates, and concentrations of real estate loans that have affected credit unions to varying degrees. The agency has also indicated it will utilize a 12-month exam schedule for federal credit unions, beginning this year, and encourage state regulators to follow suit. The NET is comprised of a director, five problem case officers and the equivalent of one loss-risk analysis officer. In addition, regional subject matter examiners will be detailed to NET on an as needed basis. The team will supervise assigned credit unions until problems are resolved, either returning the credit union to regional supervision or activating merger, conservatorship or closure, according to the NCUA announcement. Additionally, the agency said, the NET will be responsible for examining and supervising approximately ten credit unions, mainly large and more complex institutions. A side benefit of the program, though not unintended, is that the NET also represents an opportunity to expose NCUA examiners to a broad range of credit unions and varying levels of risk, thereby augmenting the NCUA’s succession planning objectives. NCUA Chairman Michael Fryzel, in launching the new trouble-shooting team, said, “The knowledge, skill, and experience of NET members will enable them to quickly identify complex problems, recommend appropriate corrective actions and thereby improve the overall quality of NCUA supervision during a very volatile period for all financial institutions, including credit unions. The NET is a logical and essential component of our overall NCUA's focus on strong and proactive regulation, and the priority we place on safety and soundness."


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