A Direct Line Blog

For those of us working in compliance and risk management, it’s a bit like another Christmas when the NCUA releases its annual list for supervision and exams in January, except of course, there are no gifts involved. It is generally a pretty accurate list of where they expect examiners will be focusing attention and topics they see as a risk to the safety and soundness of the credit union industry.

The NCUA’s 2025 list of priorities didn’t contain many unexpected topics. In the introduction, it was noted that there “continued to be signs of financial stress on credit union balance sheets during 2024,” so it should not be surprising that Credit Risk topped the list. That was followed by Balance Sheet Management, Risks to Earnings, Net Worth, and Cybersecurity. Financial Protection areas (Overdraft, Fair Lending, HMDA, Military Lending Act, and Regulation E) rounded out the list of topics you can expect to be front and center this year.

The letter includes resource links and states that the agency’s “primary objectives — ensuring a safe and sound credit union system and protecting credit union members — can only be fulfilled when we adapt to the ever-changing economic and technological landscape.”

The NCUA continues to push for third-party vendor authority. Until they have it, the letter notes that while “new programs and evolving risks related to third parties, technology, and cybersecurity may receive additional attention, your credit union is encouraged to review and maintain fundamental controls over lending, recordkeeping, and internal controls.”

We anticipate the current Vice Chair Kyle Hauptman will be appointed to chair the agency soon, and both Todd Harper and Tanya Otsuka will remain board members. An announcement was made this week on the new Western Region Director for NCUA, after Cherie Freed’s retirement last fall. Julie Cayse, previously an associate regional director in the Western Region, has been named the new Western Regional Director. Our MCU team has worked with Julie for more than a year and is excited to expand our relationship with her and her team.