Jan. 13, 2014


  • I find it odd that the examiner doesn't meet with the CEO rather than the other way around. It seems the M in CAMEL is an after thought. The examiner should ask what changes have been made in the business plan and whether the CEO thinks there are changes that affect the risk profile of the credit union. My credit union was one the the first to do indirect lending. After many years of indirect lending it is still a mystery to me why NCUA labels indirect lending as such a high risk. Dealers don't give you bad loans--if you get bad loans it is because your loan officers take bad loans. The false premise is that a type of loan or a type of lending is risky. The truth is that the risk lies mainly in the competence and expertise of the lender. Every exam should begin with a entrance conference between the examiners and the senior management team and it should end with an exit conference to review the field findings before the final exam report is written. I disagree that the CEO should be the only one answering questions. That is exactly the same mistake as having the CEO control everything that happens at the credit union. The examiner should ask questions of those who do the work. It would be good if in every exam the examiner talked with the Board Chairman to see how the Board supervises the CEO, oversees the busienss plan and budget and how the Board manages credit union performance. That is what the M in CAMEL means.
    Henry Wirz