Good communication goes a long way toward resolution
By: Patrick Smith, SVP Regulatory Affairs
Occasionally, I am contacted by the credit union CEO, staff or board member regarding issues and conflicts that arise during the regulatory examination process. The conversation usually goes along the lines that the “examiner is asking for documents they have never requested before” or “we have four examiners onsite and we have never had over two examiners in the last twenty years” or “the examiners are planning to be onsite for two weeks this year and they usually take one week to complete the exam” or all of the above.
The first question I always ask the credit union is did you ask the examiner why? Surprisingly many credit union officials regardless of the CU’s size sometimes are reluctant to engage the examiner on such matters. To be clear, it is perfectly acceptable and appropriate to directly ask the examiner valid questions and concerns regarding deviations from past examination practices and procedures. In response, the examiner almost always responds positively to such inquiries. Ordinarily, credit union officials are relieved to find out the reason there are four examiners instead of two or the exam process is taking more than the normal week timeframe is solely attributable to the fact the senior examiners are training new examiners. Many times the examiner also adds that the credit union was selected for training because it is a highly rated problem free institution. With respect to asking for documents never requested before, many credit unions are equally relieved to find out it is related to new universal examination priorities rather than anything specifically targeted at their credit union.
So the next time the examiner hits you with something out of the ordinary don’t panic just be proactive. Good communication is an essential element for a smooth examination and amicable working relationship with your examiner.
And despite your best efforts to communicate, sometime issues still remain unresolved. Rest assured that the regulatory, compliance and legal team at the league can always provide you with the next level of assistance when needed.