MCUL Staff Meet with OFIR Credit Union Division (Monitor: March 29, 2010)
League representatives and MCUL regulatory affairs staff met with OFIR Deputy Commissioner Roger Little and Assistant Director John Kolhoff on March 23 to discuss concerns and trends the regulators are seeing in the Michigan credit union industry during a tough economic period.
The first bi-annual meeting for 2010 touched on several topics, including loan modification issues, foreclosures and member business lending. OFIR reported that the watch list has seen an uptick, as net worth across all Michigan credit unions continues to decline as delinquencies and charge-offs continue to climb.
OFIR stressed its concern with regard to interest rate risk, as industry asset growth fuels the desire to invest in loans with higher earnings capacity. OFIR also reiterated its concern that loan modifications and troubled debt restructurings (TDRs) are not reported according to GAAP requirements. To ensure that credit unions understand the issues associated with loan modifications and TDRs, Kolhoff will be participating in the “Troubled Debt Restructuring: Panel Discussion” education session at the MCUL Annual Convention and Exposition (AC&E) on May 21. CEOs, Board members, lending and accounting staff are all highly encouraged to attend.
“These meetings with OFIR provide a great opportunity for the MCUL to learn the issues credit unions are facing, as well as to share the concerns of member credit unions directly,” said MCUL Vice President of Information Services Michael DeFors. “We greatly appreciate our state regulator’s willingness to engage in a dialogue to determine how we can work together to assist Michigan credit unions.”
Deputy Commissioner Little once again strongly encouraged credit union CEOs to contact OFIR’s supervisory examiners, as well as his office to discuss any unresolved differences concerning exam issues, including unprofessional examiner conduct.
Staff from the MCUL meets twice each year with senior staff from OFIR and NCUA to discuss trends, issues of concern and ways MCUL can use its resources to head off negative practices and otherwise assist in problem resolution. The spring meeting with NCUA Supervisory Examiners Andrew Healey and Dennis DeMilner is scheduled for April 20.
Concerns and questions were solicited from credit union CEOs prior to these meetings and a follow-up summary will be sent to all CEOs and posted on the MCUL Web site soon after April 20 meeting with NCUA.