Credit Union Exam Solutions Presents With Flying Colors

www.marktreichel.comhttps://www.linkedin.com/in/mark-treichel/In this episode of With Flying Colors, Mark Treichel breaks down the latest NCUA Board Meeting held on September 25, 2025. With only one agenda item—the NCUA Insurance Fund briefing—the discussion still revealed several key insights that credit union leaders need to know. From CAMELS code shifts to the impact of 27% of NCUA staff taking buyouts, Mark unpacks how these developments could shape examinations, budgets, and credit union operations in the months ahead.🔑 Key Topics CoveredInsurance Fund Health:Slight improvement in CAMELS 4s and 5s.Growth in CAMELS 3s as troubled credit unions move up a notch.What this “treading water” means for the system.NCUA Staffing & Buyouts:27% of staff accepted buyouts and will not be replaced under the hiring freeze.Why this creates short-term relief for credit unions—but possible long-term risks.How staffing shortages may lead to fewer exams, faster upgrades, and less aggressive downgrades.Board Governance & Authority:Chairman Kyle Hauptman’s nod to 2005, when a single board member issued a final rule.Could today’s board act unilaterally on budgets and regulations?Budget Implications:Early hints that credit union exam costs may drop in 2026.How senior-level buyouts produce immediate salary savings.The potential for reorganizations and cutbacks in areas like fair lending exams.Shifts in Examination Policy:Risk ratings have been removed from exam reports.Why this change matters for CEOs and exam management.📌 Why It MattersFor credit unions, these updates signal both opportunity and uncertainty. On the one hand, fewer examiners and less scrutiny may provide breathing room. On the other hand, reduced oversight could carry hidden risks for the NCUSIF and credit union stability.Mark shares his take on what credit unions should be watching—and how to prepare as NCUA adapts to a smaller workforce and shifting governance environment.

www.marktreichel.comhttps://www.linkedin.com/in/mark-treichel/In this episode of With Flying Colors, Mark Treichel sits down with Jason Stverak, Chief Advocacy Officer of the Defense Credit Union Council (DCUC), to discuss the pressing issues shaping the credit union movement.Key topics covered:🇺🇸 Veteran Business Lending Cap: Why credit unions should be free to fully support veterans and their families.🏛️ Advocacy Strategy: DCUC’s “Green Beret” approach to being nimble, prepared, and effective on Capitol Hill.💸 Credit Union Tax Status: Lessons from past fights and why vigilance is still essential.🏦 Bank Purchases: Why DCUC is defending credit unions’ ability to buy banks — and why that benefits communities.🔮 Looking Ahead: Budget cycles, NCUA staffing, and regulatory challenges that could reshape the industry.🤝 DCUC Membership: Why every credit union — not just defense-focused ones — can join and benefit.Jason shares how DCUC keeps credit unions ready for the next challenge, and why advocacy is less about size and more about strategy.

www.marktreichel.comhttps://www.linkedin.com/in/mark-treichel/Credit Unions vs. Banks: What Q2 Data RevealsIn this episode of With Flying Colors, Mark Treichel is joined by Steve Farrar, Todd Miller, and Dennis Bauer to break down the latest Q2 reports from NCUA and FDIC. Together, they unpack what the numbers really mean for credit unions, banks, and the communities they serve.What you’ll learn in this episode:📊 How credit union deposit and loan growth stacks up against banks in Q2.💸 Why net interest margins and operating expenses tell two very different stories.🏦 Where credit unions are taking market share — and where risks are rising.⚖️ The growing gap in capital strength between credit unions and community banks.🔮 Key headwinds to watch for the rest of 2025, from liquidity pressures to rising delinquencies.Whether you’re a credit union leader, regulator, or industry observer, this episode delivers insights on who’s winning the quarter — and what challenges lie ahead.

www.marktreichel.comhttps://www.linkedin.com/in/mark-treichel/NCUA's Commercial Loan Rule requires a rating system.  I discuss what it requires with Vin Vieten, author of the rule.

www.marktreichel.comhttps://www.linkedin.com/in/mark-treichel/Former NCUA Executive Director Mark Treichel talks with Ray Ragan, CIO of Securityplus Federal Credit Union, about taking AI beyond fraud detection and call center scripts. Ray shares how credit unions can use the NIST AI Risk Management Framework to build board-approved policies, leverage AI for strategic planning, and embrace Agentic AI to stay competitive. You’ll hear why human accountability matters, how to break down organizational silos, and why waiting for AI guidance could leave your credit union behind.

www.marktreichel.comhttps://www.linkedin.com/in/mark-treichel/COMMERCIAL CREDIT RISKS Rising commercial credit risks - Why regulators are worried Work-from-home impact on commercial real estate Rate shock reality: 3-4% loans resetting to 6-7%Minneapolis downtown real estate down 25% CECL forecasting challenges and provision expensesNCUA's hyperfocus on annual review processes Empty office buildings near NCUA headquarters

www.marktreichel.comhttps://www.linkedin.com/in/mark-treichel/Episode SummaryIn this episode of With Flying Colors, I’m joined by two longtime friends and former NCUA colleagues — John McKechnie and Geoff Bacino — for a candid roundtable on the latest twists at the agency and across the credit union movement.From the legal limbo over NCUA board seats to the agency’s shrinking staff and the Supreme Court case that could reshape presidential power, we dig into what it all means for your credit union. We also cover the leadership change at America’s Credit Unions, the future of CFPB oversight, and what to expect from NCUA’s upcoming strategic planning town hall.And yes — we wrap up with some NFL predictions (with John’s Ravens, Geoff’s Bears, and my Vikings all getting their fair share of good-natured ribbing).What You’ll Learn in This EpisodeThe latest on the NCUA board shake-up: Harper, Ska, Trump, and the courtsHow the Humphrey’s Executor Supreme Court case could upend federal regulatory appointmentsWhat NCUA’s staff buyouts and hiring freeze mean for supervision and examinationsWhy communication between credit unions and regulators is more critical than everInsights on America’s Credit Unions’ new CEO Scott Simpson and what his leadership could signalThe future of CFPB oversight and how credit unions should prepare for the next compliance pendulum swingWhy the upcoming NCUA strategic planning town hall is a chance for credit unions to speak upSome football predictions to lighten the mood — Ravens, Bears, and Vikings fans, take note

www.marktreichel.comhttps://www.linkedin.com/in/mark-treichel/OPERATIONAL RISKSCyber incident response planning essentials Communication strategies for cyber incidents Legacy system conversion nightmaresNCUA's helpful approach to cybersecurity findings Core system conversion best practices

www.marktreichel.comhttps://www.linkedin.com/in/mark-treichel/NCUA recently posted new guidance on how to start an exam efficiently — and for many credit unions, it couldn’t come at a better time.In this episode of With Flying Colors, Mark Treichel is joined by Todd Miller, Steve Farrar, and Dennis Bauer to break down what’s in the guidance, why it was issued, and how credit unions can put it into practice. With over 120 years of combined NCUA and credit union leadership experience, they share practical steps to streamline exam prep, avoid duplicate requests, and manage the growing number of specialists.You’ll learn:Why NCUA may be tightening its exam process — and what’s driving the changeThe importance of a “gatekeeper” role to coordinate all examiner requestsHow offsite exams and specialist involvement can create inefficiencies (and how to counter them)The behind-the-scenes impact of staff losses and policy changes at NCUATips to avoid last-minute scrambles and make your exam go smootherWhether you’re a CEO, CFO, risk manager, or board member, this conversation will give you actionable insights to protect your time and your team’s sanity — while keeping your next exam on track.

www.marktreichel.comhttps://www.linkedin.com/in/mark-treichel/INTEREST RATE ENVIRONMENTFed policy uncertainty and tariff impacts Yield curve normalization: -35 to +50 basis points CD composition shift: 13% to 28% of depositsCredit unions adapting to "new normal" Investment portfolios still 6-7% underwater Examiner demands for enhanced stress testing Cost vs. value of regulatory requests

www.marktreichel.comhttps://www.linkedin.com/in/mark-treichel/ETAIL CREDIT PERFORMANCE Student loan payment resumption impactMixed economic signals across states24 vs 26 states: unemployment trends Generational differences in borrowing behavior Venmo revolution: 85% of users under 40, $342B in Q1 transfers

www.marktreichel.comhttps://www.linkedin.com/in/mark-treichel/NCUA's regulation define what can be appealed.  But you can appeal ANYTHING to the region.  We discuss how whey and when you might want to do it.

www.marktreichel.comhttps://www.linkedin.com/in/mark-treichel/FRAUD SCHEMES[00:41:00] Timeshare resale fraud targeting elderly[00:44:00] ATM "jackpotting" - new threat explained[00:45:00] Skimming device sophistication[00:46:00] Universal key vulnerabilities

www.marktreichel.comhttps://www.linkedin.com/in/mark-treichel/Home Mortgage Disclosure Act (HMDA) Basics

www.marktreichel.comhttps://www.linkedin.com/in/mark-treichel/NCUA in Limbo: What the Board Shakeup Means for Credit UnionsEpisode Date: July 28, 2025 Host: Mark Treichel Episode SummaryThe NCUA board is in complete chaos following President Trump's firing of board members Todd Harper and Tanya Otsuka, their court-ordered reinstatement, and subsequent legal stay. Mark breaks down the dramatic week of legal battles, analyzes what happened during last Thursday's awkward board meeting, and predicts the 80% chance Harper and Otsuka won't return permanently.Key Topics CoveredThe Legal Drama TimelineTrump's firing of Harper and OtsukaFederal court ruling that Trump violated the Federal Credit Union ActWednesday court decision ordering immediate reinstatementWeekend stay blocking their returnLikely Supreme Court appeal aheadLast Thursday's Board Meeting AnalysisHarper and Otsuka's awkward return (Harper via video, Otsuka in person)Three "safe" briefings: AI, CLF, and the new Ombudsman officeThe "500-pound elephant in the room" that everyone avoidedWhy staff is in an impossible positionWhat's Next for the Board80% odds Harper and Otsuka don't return permanentlyKyle Huffman's term expires next monthPossibility of Trump appointing 2-3 new board members before year-endImpact of onboarding multiple new board members simultaneouslyInspector General Report BombshellCritical Infrastructure Division Director scandal exposedFalse statements on background investigationsSending sensitive NCUA documents to personal emailUnauthorized outside employment while at NCUAPossible connection to unauthorized AI usageBudget ImplicationsTwo-year budget cycle hanging in limboNo mid-year budget briefing despite historical precedentHow a Republican board majority might cut costs to credit unionsAugust board meeting hiatus continues traditionNotable Quotes"The 500 pound elephant in the room relative to the whole issue, all three sides avoided.""I would say 80% chance that they do not come back and that the places will be filled before the end of the year.""The professionalism of staff is well above average. And while they're going through all these things, it's chaotic."Upcoming ContentMark announces the OCC Risk Report series - breaking down his longer three-person discussion with Dennis, Steve, and Todd into shorter Thursday episodes throughout the summer. These will explore OCC findings and their implications for credit union examinations.

www.marktreichel.comhttps://www.linkedin.com/in/mark-treichel/Global Cash Flow.  What is it and why does NCUA care?

www.marktreichel.comhttps://www.linkedin.com/in/mark-treichel/ALCO committees are of paramount importance.  We take a deep dive into the nuances of this important committee and discuss Essential Reports Analysis and Risk Management

www.marktreichel.comhttps://www.linkedin.com/in/mark-treichel/Credit Union Roundtable: Mid-Year Risk Reports - Our Take on What it Means for CUsEpisode DescriptionIn this inaugural Credit Union Roundtable episode, host Mark Treichel is joined by three industry veterans to break down the OCC's Spring 2025 risk report and what it means for credit unions. Steve Farrar, Todd Miller, and Dennis Bauer bring decades of combined NCUA and credit union experience to analyze the top risk concerns facing the industry.Featured GuestsSteve Farrar - Former NCUA examiner and problem case officer with 30+ years of regulatory experience, including work on the risk-based capital rule and Central Liquidity FacilityTodd Miller - 34-year NCUA veteran, former Director of Special Actions in the Western Region, capital markets specialistDennis Bauer - Recently retired CFO of Ideal Credit Union (grew from $100M to $1B+ during his tenure), former NCUA examinerKey Topics CoveredCommercial Credit Risk (9:00)Rising delinquencies in commercial real estateImpact of interest rate resets on variable rate loansOffice building vacancy concerns post-COVIDNCUA's increased focus on annual review processesNew concentration limit requirements by property typeRetail Credit Performance (18:00)Student loan payment resumption impactsGenerational differences in borrowing behaviorAuto loan portfolio shrinkage trendsRegional economic performance variationsInterest Rate Environment (24:00)Yield curve normalization effectsCD composition changes (13% to 28% of deposits)Underwater investment portfoliosEnhanced stress testing requirements from examinersOperational Risk Challenges (33:00)Cybersecurity incident response planningLegacy system conversion risksCommunication strategies during cyber incidentsCost vs. benefit analysis for security upgradesFraud & Payment Systems (39:00)Elder fraud targeting (timeshare scams example)ATM jackpotting and skimming schemesVenmo usage statistics (85% under 40, $342B in Q1 transfers)Third-party payment system competitionBSA/AML Compliance Burden (45:00)Staffing challenges for smaller credit unionsCreating collaborative BSA officesCommittee-based approach to complianceGrowth & Competition (46:00)Slow loan growth trendsCredit unions gaining deposit market share vs. banksMoney supply impacts on deposit availabilityPricing strategy considerationsAI & Technology Adoption (50:00)Model validation requirementsThird-party vendor risk managementNCUA's AI policy challengesCompetitive advantages vs. compliance risksKey TakeawaysCommercial Real Estate Monitoring: Credit unions should closely watch their CRE portfolios, especially office properties and loans approaching rate resetsStress Testing Expansion: Expect more detailed scenario analysis requests from NCUA examiners across interest rate and liquidity risksOperational Risk Investment: Cybersecurity and system conversion planning require significant ongoing investment and expertiseGenerational Shifts: Adapting to younger members' payment preferences and borrowing behaviors is critical for long-term growthAI Adoption Strategy: Credit unions need to embrace AI while implementing proper model validation and risk management frameworksResources MentionedOCC Spring 2025 Risk Report (link in show notes)Credit Union Regulatory Guidance podcast (AI-powered audio summaries)Attorney General scam awareness resourcesNotable Quotes"A rolling loan gathers no loss" - Professor Willie Stotts reference on commercial loan repricing challenges"We took the approach that we're gonna have a cyber incident... so we took that approach in developing our incident response plan" - Dennis Bauer on cybersecurity preparation"If you don't have time to do it right, you don't have time to do it over" - On system conversion planningContact InformationMark Treichel - Host, With Flying Colors Podcast Consulting Services: Available for credit union risk management and regulatory guidanceNext Episode PreviewStay tuned for more Credit Union Roundtable discussions featuring industry veterans sharing practical insights on regulatory trends and risk management strategies.This episode provides general information and should not be considered specific regulatory or legal advice. Credit unions should consult with their own advisors and regulatory contacts for guidance on specific situations.

www.marktreichel.comhttps://www.linkedin.com/in/mark-treichel/Is your ALCO Committee structured optimally?  We can help you figure that out with this episode.

www.marktreichel.comhttps://www.linkedin.com/in/mark-treichel/Episode Summary:In this episode of With Flying Colors, host Mark Treichel sits down with Thomas Griswold, Managing Director at ALM First, to explore the financial forces shaping credit unions in 2025 and beyond. From balance sheet risk to liquidity pressures and loan participation strategies, Thomas shares insights into how ALM First helps credit unions navigate a dynamic economic environment with capital discipline at the center.They also dive into recent industry trends, including:The slowdown in consumer loan growthRebalancing liquidity post-rate hikesStrategic use of CDs, borrowings, and non-member fundingPricing risk wisely (and knowing when not to chase volume)Mergers of equals and the evolving landscape of consolidationNew developments in ALM First's services—including on-demand liquidity tools and talent retention strategiesWhether you're a CEO, CFO, or board member, this episode is packed with practical takeaways on managing risk and optimizing performance in uncertain times.🔍 Topics Covered:Why capital is the “hub” of the strategic wheelHow loan demand is shaping balance sheet strategyRisks of chasing growth versus pricing risk correctlyTools ALM First has built to model stress and liquidity in real-timeThe pilot program for credit union loan fundsHow credit unions can improve executive retention and benefitsTrends in mergers, profitability, and deposit behavior🧠 Key Quote:“There’s no such thing as risk—if you price it right.” – Thomas Griswold🔗 Resources Mentioned:ALM FirstContact Thomas: tgriswold@almfirst.com🎧 Listen + Subscribe:Available on Apple Podcasts, Spotify, YouTube, and everywhere you get your podcasts.