The Board also received briefings from the Chief Financial Officer on the revised 2016 agency budget estimates and the performance of the National Credit Union Share Insurance Fund, which grew to more than $13 billion in the second quarter of 2016.
In adopting the plan, the Board retired two agency performance goals requiring the examination each calendar year of all federally insured, state-chartered credit unions with more than $250 million in assets and every federal credit union. The Board established an interim goal of completing an efficient and effective federal and state examination process through the end of 2016.
The new strategic plan also summarizes internal and external factors affecting the agency and the credit union system, evaluates NCUA programs and risks and provides goals and objectives. The agency’s three strategic goals described in the five-year plan are:
- Ensuring a safe and sound credit union system;
- Promoting consumer protection and financial literacy; and
- Cultivating an inclusive, collaborative workplace that maximizes productivity and enhances impact.
NCUA’s Chief Financial Officer reported that agency expenditures are projected to decline by approximately $2.7 million for 2016, based on current projections of the agency’s needs.
While the agency projects a reduction in 2016 spending, several open obligations from prior years affect the amount of cash needed. Because the Operating Fee is partially determined by the agency’s cash needs, staff therefore recommended no reduction in Operating Fee collections for 2017 at this time.
NCUA’s revised estimate for its 2016 operating budget will be $288.2 million, including decreases in every major budget category. The largest change in the estimate comes from $1.9 million in lower employee pay and benefits expenses associated with vacant positions. The revised costs are based on current projections of staffing trends through the end of the year.
CAMEL Performance for 2nd quarter 2016:
- The number of CAMEL code 4 and 5 credit unions declined 16.7 percent from the second quarter of 2015 from 251 to 209. More than half were credit unions with assets of $10 million or less.
- Assets of CAMEL code 4 and 5 credit unions were $9.5 billion, a 16.7 percent decline from the second quarter of 2015.
- The number of CAMEL code 3 credit unions declined 10.1 percent from the second quarter of 2015 from 1,336 to 1,201.
- Assets of CAMEL code 3 credit unions were $85.2 billion, a 9.5 percent decline from the second quarter of 2015.
- Six federally insured credit union failed during the second quarter. Fraud was a contributing factor in all six failures.
For the first six months of 2016, there have been a total of 11 failures. The total losses associated with failures through the second quarter were $8.5 million.
The detailed NCUA board meeting summary is available online.
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