NCUA's Supervisory Priority Letter with Farrar & Miller Part 1
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Discussing NCUA's Priority Letters and the Credit Risk Landscape
In this episode of 'With Flying Colors', host Mark Treichel along with Steve and Todd, former members from NCUA, discuss NCUA's third annual letter to Credit Unions covering Exam Supervision and Supervisory Priorities. They delve into the reasons behind prioritizing the areas of credit risks, liquidity risks, and interest rate risks. Evaluating historical data and recent changes in interest rates, they reflect upon the challenges faced by credit unions in maintaining liquidity and managing interest rate risks, and how these are intertwined. The discussion covers NCUA's focus on Net Economic Value (NEV) as an examiner's tool, and the need to also consider income simulations, liquidity numbers, and other factors in the analysis. The conversation ends with a call for part two of the discussion.
00:35 Introduction and Guest Introductions
03:37 NCUA's Examination Priorities
03:58 Deep Dive into Credit Risk
12:06 Exploring Liquidity Risk
17:26 Understanding Interest Rate Risk
22:34 The Impact of Changing Interest Rates
28:32 The Role of Examiners in Risk Management
38:23 Conclusion and Final Thoughts
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