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The NCUA Tuesday released its 2020 Annual Report, which provides insights into the agency's performance over the past year and highlights its efforts to support the credit union industry and its 124 million members impacted by the coronavirus pandemic.

Responding to the coronavirus pandemic – and the resulting economic and financial disruptions – was the NCUA's primary focus in 2020. The agency revised its supervisory priorities to account for the challenges posed by the crisis and took several actions, including:

• protecting agency staff and contractors and the staff and members of credit unions by moving to a remote operations posture at the start of the pandemic;
• strengthening the Central Liquidity Facility to serve as a liquidity backstop for the credit union system;
• supporting low-income, small, and minority credit unions through the Community Development Revolving Loan Fund’s technical assistance grants and loans;
• providing measures of regulatory relief to help credit unions adapt to operational changes resulting from social distancing measures; and
• implementing statutory changes resulting from the passage of pandemic relief measures, such as the Coronavirus Aid, Relief, and Economic Security Act.

As technology modernization and cybersecurity efforts remain priorities for the agency, the annual report outlines growing cyber threats and details the NCUA's move toward a new framework for cyber-focused examinations. It also discusses the delayed rollout of MERIT and transition to the Enterprise Data Program.

NAFCU has met with NCUA Chairman Todd Harper, NCUA Board Member Rodney Hood, and senior staff in exam-related offices to discuss credit unions' exam concerns. The association has also requested the NCUA provide periodic updates on its exam modernization initiatives and recommended additional efforts while testifying on the agency's 2020-2021 budgets. The association will continue to support exam modernization and efficiency efforts to reduce credit unions' regulatory burdens.

The report also provides insights into the NCUA's perspective on fintech, acknowledging the benefits to reach underserved communities and improve financial inclusion but cautioning the risk as they are not subject to the same regulations as credit unions. NAFCU continues to be a leader in calling for a level playing field when it comes to fintech oversight.

Looking ahead, the report indicates the NCUA will monitor consolidation within the industry and its impact on the National Credit Union Share Insurance Fund (NCUSIF), as well as the NCUSIF's risk exposure from the coronavirus pandemic and emerging trends.

NAFCU has consistently advocated against charging credit unions a NCUSIF premium amid the coronavirus pandemic and against legislative changes that would alter the NCUA's management of the fund.

Access the full report here.