The National Credit Union Administration is set to undergo a large-scale restructuring – its first in more than a decade – that will, among other things, consolidate the agency’s five regional offices into three.

Under the restructuring plan, NCUA will close its Albany and Atlanta offices, and eliminate four of the five facilities the regulator leases. Additionally:

  • The Office of examination and Insurance will be restructured into specialized working groups
  • The Asset Management and Assistance Center will be realigned to include changes to the servicing business model and move to a financial supervisory structure
  • An Office of Credit Union Resources and Expansion will be created by redefining and realigning chartering and field of membership, credit union development, grants and loans, and minority depository institutions programs
  • Various agency offices with overlapping functions will be eliminated with a goal of improving functions such as examination reporting, records management and procurement.

NCUA did not release estimates of how the proposed changes will impact its budget, though the agency said the plan would be discussed in greater detail during its fall budget briefing. No job cuts are expected, though the agency’s overall workforce is expected to shrink as the result of attrition.

“The time has come for the NCUA business model to change,” Board Chairman J. Mark McWatters said in a statement. “Positioning the NCUA to meet the changing demands of the credit union system we regulate in a transparent and fully accountable manner while promoting efficiency and effectiveness is essential. Re-evaluating our operations is integral to fulfilling our statutory responsibilities to protect the deposits of the nearly 108 million credit union members while maintaining the safety and soundness of the Share Insurance Fund and the viability of the credit union system.”

The changes outlined are the result of an internal review undertaken late last year to “rethink the agency’s operations, discuss how it can re-tool to do its job better and make recommendations to the Board,” according to a press release announcing the restructuring.

“Months of very hard work by agency staff have produced a solid, common-sense plan that will help the agency respond to a new economic environment without sacrificing its ability to ensure the safety and soundness of our credit union system,” Board Member Rick Metsger said. “The restructuring effort will come together over a period of years, and credit unions will reap tangible benefits from our work.”

Right-sizing
Former NCUA chairman Dennis Dollar – who closed and relocated one regional office during his tenure as chairman – praised the move, saying finding greater efficiencies would help make the agency better suited to a more technological age.

As the number of credit unions continues to decrease, additional efficiencies can certainly come into play such as closing offices and moving more of the exam process off-site,” he said in an email to Credit Union Journal. “I think the NCUA Board and Chairman McWatters deserve commendation for this effort to right-size the agency and make it more efficient in this ever-more technological age.”

Credit Union National Association President and CEO Jim Nussle commended McWatters for attempting to "modernize agency operations" and said the trade group looks forward to working with him to find more ways to reduce regulatory and examination burdens for CUs.

The National Association of Federally-Insured CUs offered a similar comment, with NAFCU Director of Regulatory Affairs Alexander Monterrubio saying the association is "encouraged that NCUA is positioning itself for the future by committing to increasing efficiencies and eliminating waste."

Former NCUA board member Geoff Bacino commended the agency for the move, noting that having so many regional offices was part of an outdated practice. “Many of the functions that formerly needed to be done out of an office can now be consolidated, and accomplished through economies of scale and remotely.”

Updated Friday, July 21, 2017 at 4:14 p.m.