Emerging credit risks resulting from the coronavirus crisis will be the focus of questions by federal examiners when they begin contacting the institutions they review beginning next week, the federal credit union regulator said Wednesday.
In a letter to credit unions (LTCU 20-CU-12), the National Credit Union Administration (NCUA) said its initial outreach to federally insured credit unions focused on operational status and liquidity. Now, the agency said, it is expanding outreach to identify any emerging credit risks.
The agency said prior outreach to credit unions has found:
- Nearly all credit unions report full or partial service to members; some that have closed locations due to their sponsors being closed (including school districts and churches, among others) are continuing to serve members’ needs by appointment.
- Although many credit unions report their lobbies are generally closed, the vast majority are offering lobby appointments. Credit unions that are not offering lobby appointments are providing services using a drive-through or offering appointments at other locations.
- Few credit unions report a need to increase borrowings.
The agency also acknowledged it is monitoring the pandemic’s effect on credit unions through indirect means (other than direct examiner contact) through information provided by corporate credit unions, other financial service providers, and other government agencies.