In its recently published "Compliance 101" handbook, the National Association of Federal Credit Unions urged federally insured credit unions to consider several distinct areas of risk so as to ensure full regulatory compliance. Laying out what NAFCU Director of Regulatory Compliance Brandy Bruyere said the NAFCU "will be thinking about when they look at your credit union," Bruyere says unions should consider a variety of factors in their underwriting.
Aside from the usual lender/borrower credit risk considerations, the NAFCU also cautions that credit unions should consider the added risk of investing in third parties. Other risks mentioned and elaborated on by the NAFCU included:
- Interest rate
Compliance, Bruyere said, is the NAFCU's main focus, taking a "very broad" view on the "laws, rules and regulations affecting credit unions, or to credit unions' internal policies, procedures, ethical standards, contractual obligations and exposure to litigation."
"The NAFCU cautions that credit unions should consider the risk of investing in third parties."
In a separate letter to the editor sent to the Credit Union Times, NAFCU Board Chair and President/CEO of SRP Federal Credit Union Ed Templeton also pushed for another, less regulated, element that could aid credit unions: collaboration and cooperation.
Writing in response to Marcus Schaefer's "The Danger of Affiliation Wars" article, Templeton asserts the importance of both healthy competition to strengthen the market and aid consumers, but also coordination to help shelter the industry from potentially unfair regulation.
"As the competitive landscape continues to evolve, it is all the more critical that we represent credit unions with a unified voice," writes Templeton. Templeton makes note of the fact that the Credit Union National Association, another national trade association for both state- and federally chartered credit unions, has declined several NAFCU invitations to compliance workshops and roundtables. Both Schaefer and Templeton advocate for the unification of trade associations to help credit unions more effectively deal with external threats.