Agency outlines strategies for credit unions to take in serving members during coronavirus crisis

Teleworking adopted through end of March; outlines offsite exam use

Strategies credit unions may consider when determining how to work with their members to address the impact and challenges of COVID-19, the coronavirus, are outlined in a new letter to credit unions sent to them by their federal regulator Monday.

The letter also details the National Credit Union Administration’s (NCUA) plans for in-person examinations at credit unions and its operational status, noting that – through March 30 – NCUA has mandated telework for headquarters and regional office staff “unless narrow exemptions are met.”

The letter, sent to credit unions from NCUA Board Chairman Rodney Hood, assures credit unions that agency examiners will not criticize a credit union’s efforts to “provide prudent relief for members when such efforts are conducted in a reasonable manner with proper controls and management oversight.”

“The NCUA encourages credit unions to work with affected borrowers,” Hood wrote, amplifying similar messages issued by other federal regulators of financial institution. “A credit union’s efforts to work with members in communities under stress may contribute to the strength and recovery of these communities.”

Among the strategies Hood cited in his letter for credit unions to consider:

  • Offer payment accommodations, such as allowing borrowers to defer or skip some payments, or extend the payment due dates, which would avoid delinquencies and negative credit bureau reporting caused by any COVID-19-related disruptions;
  • Waive overdraft fees;
  • Waive early withdrawal penalties on time deposits;
  • Increase ATM daily cash withdrawal limits;
  • Ease restrictions on cashing out-of-state and non-member checks;
  • Offer or expand payday alternative loan (PAL) programs.

Regarding the agency’s exam and supervision program, the letter states that is limiting that work “over the next couple of weeks” to offsite procedures only. A few exceptions for exigent circumstances will be made, the letter states. The agency added it will be evaluating that approach regularly and extending it as necessary.

In mandating telework, Hood’s letter stated that the agency “has a history of operating the agency from a telework posture.”

“We expect operations to proceed with little interruption. This includes processing credit union inquiries and requests such as regulatory approvals and field of membership expansions,” the letter stated.

Letter to Credit Unions 20-CU-02: NCUA Actions Related to COVID-19

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