Conservatorship: When NCUA Removes the Board & What You Need to Know

Episode Summary:

In this special episode, hosts Mark Treichel, Steve Farrar, and Todd Miller dive into the high-stakes world of NCUA conservatorships—when the agency steps in to remove a credit union’s board and take control. Drawing from their extensive experience handling some of the largest conservatorships in NCUA history, they provide insider insights on:

• What conservatorship means and when it happens
• The role of the NCUA as both regulator and conservator
• Why NCUA often opts for conservatorship over cease-and-desist actions
• The challenges of managing a conservatorship from both a regulator’s and a credit union’s perspective
• Success stories and lessons learned from past conservatorships

The hosts reflect on the intensity, challenges, and rewards of the conservatorship process, including the balance between protecting the NCUSIF (National Credit Union Share Insurance Fund) and serving credit union members. Whether you’re a credit union executive, regulator, or industry observer, this episode delivers valuable insights into one of the NCUA’s most powerful enforcement tools.

Key Quotes:

🗣️ “Conservatorships are an adrenaline ride. They can be a challenge, they can be fun, they can be scary—and they can be very effective when they're appropriate.” – Mark Treichel

🗣️ “Most conservatorships come down to people problems—boards and executives that can’t or won’t fix the issues.” – Todd Miller

🗣️ “NCUA has to strike a balance between protecting the insurance fund and doing what’s best for the credit union’s members.” – Steve Farrar

Resources & Links:

🔹 Learn more about NCUA conservatorships and credit union exam solutions at MarkTreichel.com

🔹 Subscribe to With Flying Colors on your favorite podcast platform to stay up to date on credit union regulations and best practices.

🎧 Don’t miss this deep dive into one of the most extreme actions NCUA can take—hit play now!

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The NCUA’s boardroom has been rocked. Two board members fired. DOGE staff roaming the halls. Rumors of a regulatory consolidation swirl. In this must-hear episode, Mark Treichel is joined by former NCUA Board Member Geoff Bacino and former NCUA Congressional Affairs Director John McKechnie to unpack one of the most chaotic weeks in recent credit union regulatory history.

From unprecedented dismissals to the looming question of NCUA’s independence, we cover:

• 🔥 The removal of Todd Harper and Tanya Otsuka: What happened, what’s legal, and what’s next
• 🛡️ What the DOGE (Department of Government Efficiency) visit to NCUA signals
• 🧨 Are we headed for a consolidation of financial regulators?
• 🏛️ The forgotten Supreme Court case that may decide the future of independent agencies
• 📉 Why up to 20% of NCUA staff may exit — and what that means for credit union supervision
• 🧠 Institutional memory, directed reassignments, and the “brain drain” risk
• 💡 Predictions on new board nominations, and what credit unions should watch for next

Whether you’re a credit union executive, examiner, or policy junkie, this is your front-row seat to the unfolding transformation at 1775 Duke Street.

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White House press secretary Karoline Leavitt defended the firings, saying, “President Trump is the chief executive of the executive branch and reserves the right to fire anyone he wants.”

Warren:

“President Trump just fired two Board Members at the National Credit Union Administration in his continued attack on American consumers. This is the latest attempt by Trump to skirt the rule of law, undermine independent agencies, and illegally purge the government of those who work for the American people.”

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Episode Overview:

In this episode of With Flying Colors, Mark Treichel tackles two hot topics ahead of the upcoming NCUA Board meeting:

1. The Staff Buyout Program: With 145 FTEs already accepting voluntary separation packages—roughly 12% of NCUA's workforce—Mark explores the deeper implications. Could the agency be targeting a symbolic sub-1,000 FTE threshold? Poll results and inside intel help paint the picture.
2. The Wildfire Relief Briefing: Mark offers context for why the interagency appraisal relief rule—issued in January—is now being briefed to the NCUA Board in April.

Plus, a timely listener tip leads to a discussion of Treasury Secretary Scott Bessant’s recent remarks about reshaping regulatory culture—calling for more transparency, better tailored supervision, and a possible redefinition of "safety and soundness."

📊 Topics Covered:

• C. Northcote Parkinson’s quote on vacuums and rumors
• Triangulating NCUA’s staff reduction targets
• Poll insights: 90% of listeners prioritize the buyout news
• Board dynamics and scripted briefings—what to listen for Thursday
• Treasury’s evolving role in banking regulation under Bessant
• Why defining “unsafe and unsound” could transform CU oversight

🗣️ Listener Tip of the Week: A sharp-eyed listener flagged Bessant’s speech, opening the door to a broader discussion on Main Street vs. Wall Street priorities and the future of regulatory supervision.

🎧 Listen to learn:

• What NCUA might really be signaling with its buyout program
• How upcoming briefings may reveal internal Board dynamics
• Why new rhetoric from Treasury could matter for credit unions

Episode Summary:
In this episode of With Flying Colors, host Mark Treichel is joined by former NCUA capital markets expert Todd Miller to discuss the latest updates to NCUA’s Interest Rate Risk (IRR) Supervisory Framework. Following NCUA’s recent stakeholder webinar, we break down key takeaways, including changes to risk categorization, the elimination of the extreme risk rating, and how these updates impact credit unions navigating today’s economic landscape.

What You’ll Learn in This Episode:
✅ The history and evolution of NCUA’s NEV framework
✅ Why NCUA eliminated the “extreme risk” category and what it means for credit unions
✅ The role of examiner judgment in assessing interest rate risk under the new guidance
✅ How credit unions can mitigate risk and avoid a Document of Resolution (DOR)
✅ The growing importance of liquidity management and how credit unions should prepare
✅ Why examiner scrutiny of IRR is increasing, despite the removal of automatic DORs

Key Takeaways from the NCUA Webinar:
🔹 NCUA clarified that interest rate risk remains a top supervisory priority for 2023 and beyond.
🔹 Credit unions must demonstrate strong risk management practices to avoid regulatory action.
🔹 Liquidity risks are increasing due to rising rates and market shifts—credit unions should reassess their funding strategies.
🔹 Open communication with examiners is essential—proactive discussions can help avoid surprises.

Resources Mentioned in This Episode:
📄 NCUA’s Letter to Credit Unions (22-CU-09): [Insert link if available]
🎥 NCUA’s Stakeholder Webinar on Interest Rate Risk: [Insert link if available]
🔍 Learn more about Credit Union Exam Solutions: marktretchel.com

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A quick-hit episode this week! Mark shares thoughts on Duke’s March Madness collapse, the rise of Rodney Hood at OCC, Jim Nussle’s pending retirement, and NCUA’s buyout offers. Plus, a few takes on market volatility, sub debt approvals, and the ever-shifting dynamics at the NCUA Board.

Topics Covered:

• Duke’s tourney loss and dynasty hate
• Rodney Hood's possible FDIC move
• Jim Nussle’s retirement news
• NCUA staff buyouts and exam slowdowns
• The case for sub debt
• Market drops and flight to quality

Episode Title:

NCUA: Can You Put That in an Examiner Finding, Not a DOR?

Episode Summary:

In this episode of With Flying Colors, host Mark Treichel is joined by Steve Farrar and Todd Miller to unpack the complexities of NCUA examinations, examiner findings, and documents of resolution (DOORS). They dive into what makes an issue rise to a DOOR, how credit unions can negotiate findings, and why corporate governance is becoming a focal point in exams.

With their decades of experience inside NCUA, Mark, Steve, and Todd share insights on how credit unions can better navigate the regulatory process, avoid unnecessary compliance burdens, and strengthen their governance structures. If you've ever wondered why something lands in a DOOR rather than an examiner finding, this episode is for you!

Key Topics Covered:

✔️ What qualifies as an examiner finding vs. a DOOR?
 ✔️ How credit unions can respond to and negotiate with NCUA
 ✔️ The rising focus on corporate governance in examinations
 ✔️ How unresolved examiner findings escalate over time
 ✔️ The role of supplementary facts in the examination process
 ✔️ Understanding regional director letters and enforcement trends

Guest Information:

🎙 Steve Farrar – Former NCUA official with 30+ years of experience in risk management, enforcement, and problem case resolution.
🎙 Todd Miller – Former NCUA examiner, capital market specialist, and director of special actions, with 35 years of regulatory expertise.

Host Information:

🎙 Mark Treichel – Former NCUA executive and credit union expert, dedicated to helping credit unions optimize their exam results.

Resources Mentioned:

🔗 MarkTreichel.com – Learn more about Credit Union Exam Solutions
🔗 NCUA CAMELS Rating System
🔗 FDIC Proposed Corporate Governance Guidance

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In this episode of With Flying Colors, Mark Treichel is joined by Jason Stverak, Chief Advocacy Officer of the Defense Credit Union Council (DCUC), for a wide-ranging conversation on the unique role defense credit unions play in serving military members—and the policy battles threatening their ability to do so.

Jason shares how DCUC advocates for military-affiliated credit unions across a rapidly evolving regulatory and political landscape. From the impact of the Credit Card Competition Act on interchange fees to the overdraft protection debate and the ongoing defense of the credit union tax exemption, this episode dives deep into the issues shaping the future of service-based financial institutions.

You’ll also hear powerful real-world stories—including how Navy Federal helped a young Marine avoid a predatory car loan, and how Enbright Credit Union supports members battling cancer—that illustrate the mission-first, member-first mindset of credit unions in action.

🔍 Topics Covered:

• What DCUC is and who it serves
• Why interchange income matters, especially for defense credit unions
• The Credit Card Competition Act: risks and real-world impacts
• Overdraft protection and CFPB’s regulatory shifts
• The importance of preserving the credit union tax status
• Real stories of credit unions stepping in when members need them most

👤 Guest:

Jason Stverak
Chief Advocacy Officer, Defense Credit Union Council
🔗 DCUC.org

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Episode Summary: 

In this episode of With Flying Colors, host Mark Treichel is joined by Steve Farrar and Todd Miller from Credit Union Exam Solutions to discuss the serious implications of a CAMEL Code 4 rating. A downgrade to CAMEL 4 signals significant risk and increased regulatory scrutiny. What does this mean for your credit union? What immediate actions should management and the board take? How does this impact borrowing, liquidity, and operations? Get expert insights into navigating the challenges of CAMEL 4 and what steps to take to get back on track. 

What You’ll Learn in This Episode: 

✅ What is a CAMEL Code 4? Understanding why it’s a major red flag
✅ How NCUA views CAMEL 4 credit unions and why they ramp up oversight
✅ The consequences of a downgrade – more frequent exams, lost privileges, and reputational risk
✅ NCUA’s administrative actions – what happens when you receive a Letter of Understanding & Agreement (LUA)
✅ How a CAMEL 4 affects your liquidity – Federal Reserve & Federal Home Loan Bank implications
✅ The impact on borrowing & collateral requirements
✅ The role of the board in a CAMEL 4 credit union – what’s expected of leadership
✅ Can a CAMEL 4 credit union recover? Strategies for improvement 

Key Takeaways: 

🔹 CAMEL 4 credit unions face exams every 120 days, meaning examiners are always present
🔹 Expect Letters of Understanding & Agreements (LUAs) and preliminary warning letters
🔹 NCUA and federal agencies (like the Federal Reserve & FHLB) are notified, impacting borrowing & liquidity
🔹 The board and management face increased accountability, with NCUA requiring approval for senior leadership changes
🔹 A downgrade to CAMEL 4 means administrative oversight, and in some cases, public disclosure (depending on state regulations)
🔹 Credit unions in this category must act quickly to stabilize finances and demonstrate improvement to avoid further decline 

Resources Mentioned: 

📌 NCUA’s National Supervision Policy Manual (for details on CAMEL 4 oversight)
📌 NCUA’s Share Insurance Briefing (for trends in CAMEL ratings)
📌 Credit Union Exam Solutions – Expert consulting for navigating NCUA exams 

Connect With Us: 

🌐 Visit marktreichel.com for expert guidance on NCUA exams
📩 Have a question or topic suggestion? Email us at [your email/contact info]
📲 Follow us on LinkedIn, Twitter, or Facebook for more credit union insights 

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In this episode of With Flying Colors, host Mark Treichel is joined by Steve Farrar and Todd Miller to analyze the latest trends shaping the credit union industry in 2024. They dive into the recently released NCUA data, discussing multi-year trends, economic pressures, and how credit unions are navigating challenges such as rising delinquencies, declining net income, and shifting liquidity conditions.

Key Topics Covered:

✅ Multi-Year Credit Union Trends – How decisions made during COVID-19 continue to impact the industry today
✅ Rising Credit Risk & Loan Performance – What’s driving the surge in credit card and auto loan delinquencies?
✅ NCUA’s Supervisory Priorities – Where examiners are focusing their attention in 2024
✅ Liquidity & Interest Rate Risk – How credit unions are adjusting to changing market conditions
✅ Earnings & Profitability Pressures – Understanding the impact of fee income declines, provision for loan losses, and economic uncertainty
✅ Regulatory Challenges & Mergers – The latest data on credit union consolidations and how they compare to community banks

Recent Exam Trends:

🔹 Increased scrutiny on commercial lending programs and credit concentration limits
🔹 More emphasis on profitability analysis at the loan program level
🔹 Examiners pushing for stronger liquidity contingency funding plans
🔹 Greater focus on enterprise risk management in larger credit unions

🎧 Listen now to get the full breakdown of the latest trends and how they could impact your credit union’s operations.

Resources & Related Episodes:

📌 Want to learn more about specific regulatory issues? Check out our past episodes on:
 🔹 Commercial Lending Risks & Best Practices
 🔹 Managing Interest Rate & Liquidity Risk
 🔹 Navigating NCUA’s Supervisory Priorities

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