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NCUA Seeks Comments on Proposed Call Report Modernization
Friday, January 26, 2018 6:45 AM

Board Adopts Updated Strategic Plan, Annual Performance Plan

The National Credit Union Administration Board held its first open meeting of 2018 at the agency’s headquarters Thursday and unanimously approved two items:

  • A proposed rule to clarify agency procedures for resolving severance claims arising from involuntary liquidations.
  • The agency’s 2018-2022 Strategic Plan, which summarizes internal and external factors affecting its operations, evaluates programs and risks, and sets goals for the next five years, and the 2018 Annual Performance Plan, which provides specific direction for reaching those strategic goals.

The Office of Examination and Insurance briefed the board on proposed changes to the Call Report, which are aimed at reducing reporting burdens. A request for information will be posted in the Federal Register for a 60-day comment period.

The Office of the General Counsel briefed the board on inflation adjustments to civil monetary penalties, as required by federal law.

Call Report Modernization Would Reduce Reporting Burdens
As part of a long-range effort to simplify filing of quarterly Call Reports, the NCUA is seeking public comment on proposed changes aimed at striking a balance between reducing burdens on credit unions and providing the agency with information necessary for supervision and data analysis.

“Call Report data is essential to the NCUA’s operations, and reporting is a significant responsibility for credit unions,” said NCUA Board Chairman J. Mark McWatters. “The agency has undertaken a comprehensive review of the Call Report to modernize and increase efficiencies. We hope that credit union stakeholders will review the proposed changes and continue to provide comments on this important and significant project.”

Comments on the proposed changes must be received within 60 days of publication of the agency’s request for information in the Federal Register. In the meantime, the proposed forms and instructions the agency is considering, as well as other information about the Call Report modernization program, are available on the agency’s dedicated webpage.

The proposed Call Report changes are the result of NCUA’s modernization program, begun in 2016, which included significant outreach to credit union stakeholders. The proposed changes would reduce the number of account codes in the 5300 Call Report by approximately 40 percent. Schedules would be reorganized, and instructions would be improved.

The agency will ask credit unions to consider these questions as they review the proposed changes:

  • Is this a reduction in the reporting burden?
  • Are any account codes slated for retirement still pertinent?
  • Are the relocated account codes grouped logically?
  • Should any schedules be expanded to assist in analysis based on new rules or accounting changes?
  • Are the instructions adequate?
  • How much time will credit unions need to make changes in their systems to adapt to Call Report changes?
  • Are the other operational issues the NCUA should be aware of prior to implementing the proposed changes?

A slide presentation summarizing the proposed changes is available online here.

Strategic Plan Reflects How the NCUA Will Respond to Change
The NCUA’s 2018-2022 Strategic Plan, approved by the board, describes how the agency intends to adjust to change in the credit union system and incorporates a risk management framework to help the agency continuously identify, evaluate, and manage risk.

The NCUA’s three strategic goals described in the five-year plan are:

  • Ensuring a safe and sound credit union system;
  • Providing a regulatory framework that is transparent, efficient, and improves consumer access; and
  • Maximizing organizational performance to enable mission success.

The agency is adopting new technology and analytical tools to improve its offsite monitoring; recalibrating its examination approach; and revising operations, priorities, and structure to use its resources most effectively.

The agency’s 2018 Annual Performance Plan provides specific direction and guidance to implement the overarching objectives listed in the Strategic Plan. The annual plan describes how the strategic goals will be reached and how the agency will monitor progress and identifies three priorities among the performance goals:

  • Fully and efficiently execute the requirements of the agency’s examination and supervision program;
  • Enable continuous risk analysis and identification of key trends to target examinations where they are most needed; and
  • Promulgate efficient, targeted regulation tailored to offer meaningful relief without undermining safety and soundness.

The 2018-2022 Strategic Plan, the companion 2018 Annual Performance Plan, and previous plans are available online here.

Proposed Rule Would Clarify Severance Claims Process in Involuntary Liquidations
The process for credit union employees to make severance claims following involuntary liquidations would be revised by a proposed rule (Part 709) approved by the board.

The proposed rule would clarify the requirements for proof of a claim by an employee for pay or benefits such as unpaid wages, sick time, or vacation time while making a distinction between employees’ claims and claims by a credit union executive that constitute a golden parachute.

Comments on the proposed rule, available online here, must be received within 60 days of publication in the Federal Register.

Final Rule Confirms Required Inflation Adjustments to Civil Monetary Penalties
The board approved a final rule (Part 747) to amend its regulations and adjust for inflation the maximum amount for civil monetary penalties under its jurisdiction, as required by federal law.

The Federal Civil Penalties Inflation Adjustment Act Improvement Act of 2015 requires agencies to make annual adjustments and publish them in the Federal Register no later than January 15. The Act requires agencies to adjust the maximum amounts of civil monetary penalties to account for inflation. The Act does not require NCUA to assess the maximum penalty level, and the agency retains discretion to assess at lower levels, as it has done historically.

To make the adjustments required by law, the board approved the final rule by notation vote on Jan. 9, 2018. The final rule, which became effective January 15, is available online here.