The NCUA released Letter No. 17-CU-01, which describes their supervisory priorities for 2017. The primary areas of focus are:
- Cybersecurity Assessment. Credit unions are encouraged to use the Cybersecurity Assessment Tool, and examiners will continue to evaluate the credit unions’ cybersecurity risk management practices.
- Bank Secrecy Act Compliance. As always, BSA is a hot topic. Additional focus will be on accounts for money services businesses and other accounts that pose a higher risk for money laundering.
- Internal Controls and Fraud Prevention. Examiners will evaluate the adequacy of the credit union’s internal controls, along with overall efforts to prevent and control fraud.
- Interest Rate and Liquidity Risk. NCUA staff will use a revised interest rate risk supervisory tool and new examination procedures to assess interest rate risk management practices. See NCUA Letter to Credit Unions 16-CU-08 for more information.
- Commercial Lending. NCUA will evaluate a credit union’s commercial loan policies and procedures and assess the risk management processes associated with managing a commercial loan portfolio.
- Consumer Compliance. Additional focus will be on the Military Lending Act and Servicemember’s Civil Relief Act.
Washington State DCU also release its examination focus for 2017 in Bulletin B-17-01. It also includes Cybersecurity, Member Business Loans, Interest Rate Risk, and Consumer Protection Law Compliance. The Consumer Protection Law Compliance section will cover the effectiveness of the overall compliance management program and the program’s ability to detect and self-correct problems, along with the credit union’s timelines for implementing new regulatory compliance requirements.
For credit unions with over $500 million in total assets, the DCU plans to schedule separate compliance examinations and safety and soundness examinations.