Credit Union Exam Solutions Presents With Flying Colors

Treichel: Hey everyone.

This is Mark Treichel with
another episode of with.

Flying colors.

I'm excited today to be here with Katie
Averill of the Iowa Credit Union Division.

Katie, how you doing today?

Katie Averill: I'm doing great, Mark.

I appreciate being here with you.

Treichel: Yeah, I'm excited to chat today.

And of course, you're also the head of
the you're the chair of the NASCS board.

So we'll get into that as well.

You've got dual hats, but if you
could give me a little bit of your

background, so the listeners know
the journey that you've taken in the

credit union industry up through today.

Katie Averill: Yeah, absolutely.

I do have the unique perspective
in my career of working at a bank,

a savings bank, a savings and loan
and a credit union before I became

a financial services regulator.

So my 1st 10 years in the
movement was with organization

called Citizens Community Credit
Union in Fort Dodge, Iowa.

And I had some experiences in marketing.

Operations, branch management,
executive leadership, and on

board of directors, staff liaison.

And I sometimes reflect on
the wonderful foundation that

I was afforded at that time.

Mark.

Of course, I didn't know how important
this would be in my position now,

but it's fair to say that I have
seen and lived the credit union.

I'm doing air quotes here shop
experience from working on the

teller line community events.

HR issues opening branches.

It's a lot of different things
that I have experienced all the

way to strategic planning and
board of directors decision making.

So I was also able to attend CUNY
school while I was at citizens and

that really broadened my perspective
and truly I wouldn't trade any of

those experiences at the credit union.

I really learned a lot.

But during this time, I developed a
friendship with the lieutenant governor,

Kim Reynolds, and she was very supportive
of my foundation that promotes literacy.

In my hometown, and it's called the
joy of reading and at that point, she

asked me to serve on a state board
in 2015 that focused on Children.

In the meantime, in 2017,
Joanne Johnson, the former N.

C.

U.

A.

Board member and chair and
a mutual friend of ours.

Mark.

That's right.

Announced her retirement
and the lieutenant governor

became the governor of Iowa.

So I was appointed by her in
2017 to serve as the director of

commerce and the superintendent
of the Iowa Credit Union Division.

The industry really welcomed the
new chief regulator because of my

background coming from the industry.

I think, a family affair to
bring me into this position.

And to this day, I still
rely on my background in

making decisions that impact.

The credit unions in Iowa.

I understand firsthand the challenges
and opportunities of our credit

unions, and there really is a
balance between supervision and

the support the credit unions need.

to succeed and innovate.

And just this week, I spoke at a
conference and realized this was my

eighth time presenting at this conference.

Time flies when you're
having fun, I guess they say.

So I truly am proud of the public
service that I have been, able to give to

Iowans and being able to oversee such a
successful credit union system in Iowa.

We have a great state charter.

I think, those are some of the
reasons why we feel like Iowa has

great opportunities for their credit
unions and a very good league that

supports the credit unions as well.

So I often say we have 66 credit unions
and 66 different business models.

And one of my favorite things to
do is to visit those credit unions.

In 2019, I was able to visit.

87 credit unions.

And that was quite a remarkable
feat driving from the each

corner of the state of Iowa.

But I think you really get
a different perspective when

you have boots on the ground.

You really get to see the members and the
staff and the communities that they serve.

So that's been some of my highlights
in the beginning stages of my career.

Treichel: That's fantastic.

And I, as you were describing coming from
credit unions, I wrote down two things,

having been there and done that, right?

Being a regulator is different when
you've been regulated and you see

the ramifications of those firsthand,
whether it's staffing issues or

regulatory burden or what have you.

And then also common sense.

I think it gives you Sometimes,
you can sit in Washington D.

C.

And write a regulation and think that
it's crystal clear but if you don't

have, if you don't expose it to the
wisdom of crowds and get the input

from the people who actually had boots
on the ground you can have something

that's crystal clear to you that just
absolutely makes no sense in reality.

I know that you brought that to your role.

And and I also think about, it didn't
write this down, but I'm thinking about

the federal credit union act allows
one of three NCAA board members to be

someone with a credit union background.

And there was a time period when
that was typically the norm.

Now they tend to come from Washington DC,
whether it's, the someone who worked for

a certain Senator is typically where it
comes from, we have one that came from

the banking committee and also FDIC.

And there's a reality check with
the kind of background that you have

that, that I think you can bring to
the table for what you do for Iowans,

for what you do for Nazca's, but
it also gets to, what's going on.

On in Washington right now, because we're
in a very unique time, where, regardless

of where you're at on the political
spectrum, it's there's a lot of change

and intense change going on right now.

Any thoughts from where
you sit on, the impact.

On credit unions as it
relates to the Washington D.

C.

Scene right now.

Katie Averill: Yeah wow.

We live in interesting times, right?

I think there's a saying that we're
blessed to see such interesting times

and I really do take these kind of
changes and transitions as they come.

We see this oftentimes in state
government, a lot of different

changes and transitions, newly
appointed officials, especially when

a governor were to change in a state.

In Iowa we've really been
fiscally responsible and

really focus on efficiencies.

And our governor has led in this area
through state government alignment.

We had an alignment process where we
really took a look at the agencies

in Iowa and looked for efficiencies.

That was about a year and a half ago.

I think that's our culture here in the
state is to look for those efficiencies.

There's nothing really new about the way
that we're acting as state regulators.

Even in light of all the changes
that are happening in Washington D.

C.

But, as far as the workforce that
we see, I know that's one of the

conversations that's Being had it's
really incumbent upon the agencies to

ensure that they're operating efficiently
and, we assess our credit unions for.

The work that we do in the division,
but the key is to balance that

responsibility with sufficient
staffing and enough to safeguard the

public's confidence in the safety and
soundness of the credit union system.

So all of these things are,
business as usual mark, come to

work every day and do your job.

But there's always interesting times.

I guess that would be how I would.

summarize what's
happening in Washington D.

C.

And that's really the beauty.

One of the things that I like
most about my job is I come

and every day is different.

That's the plan that I have
anyway, as the superintendent of

the credit union division in Iowa.

Treichel: No, I like that.

The concept of that too.

You talked a little bit about
The strength of your state

program and the 66 credit unions.

Back when I was an examiner in
Minneapolis, when I started with NCUA

we had, we, our supervisory examiner
group covered Minnesota and Iowa.

And at the time, I don't know how many
credit unions there were at the time.

More than 66?

Yes.

But it was maybe there were
zero to one to 5% of the.

Friday unions in Iowa were
federal charters back then, and

it's probably a similar stat.

Now there's just not a lot of
federal charters, which goes

To the strength of that system.

And if you could maybe speak to, to,
to that a little bit as it relates to

the size and the makeup of that system,
but just as I'm thinking out loud

your, because so many of them are state
charters any staffing challenges that

NCOA might have because of a freeze
are likely going to impact Iowa less.

Then the average state, just
because so many of your.

credit unions are already state charters.

So you're probably staffed a little
higher than the average state.

You can maybe comment if I'm if
that sounds right to you or not.

Katie Averill: I would agree
with you that the Midwest is

known for the state charters.

And I think I made this comment
just a minute ago about the

strength of the charter.

I think that's really where it begins.

I'm also going to say that the
accessibility of the state regulator is

an important piece that I hear from the
leaders in the credit unions in Iowa.

I think that's another thing that
state charters really can understand

the communities that they're serving.

And that's what the regulators
do in the state system, I

think, and do very well in Iowa.

Currently, back to your point, we
had nearly 100 when I began in 2017.

And today we have 66 to federally
charter credit unions in Iowa.

So about 97 percent mark is, it's still
in that range of very much dominated

by the state charter credit unions.

We have 16 in our staff and
really, I think we operate

very efficiently with those 16.

And if I can brag for a moment I truly
believe we have one of the strongest and

best state exam teams in the country.

Our senior team consists of an attorney.

data analyst and cybersecurity experts.

So we really bring to the table.

What I'm really proud of is we
develop that examination team

based on the needs of our system.

And, I feel like this is the theme
of our conversation is really

listening and listening to the
needs and the credit unions in Iowa.

That's the makeup of our system.

We have 32.

8 billion in assets in Iowa, ranging
from near 11 billion to a smaller

credit union that's open on Sundays
at one of the local churches.

So we have a broad variety of
credit unions, but proud of each

and every one of them and how
they serve their members in Iowa.

Treichel: One of the things you touched
on there Yeah, I'll put it in my words.

It's local control.

It seems like in Iowa,
local control is important.

And when I talk to when I was at N.

C.

U.

A.

or when I was now, when I'm talking
to clients that might be contemplating

merger there's that the fact that
the biggest challenge of merger is

giving up that local control, right?

And even though it might just be a
credit union in one town being taken

over by the other town, there's that.

Pride of ownership, the pride of
community, and I think just because of the

strong presence of state charters in Iowa
speaks to that desire for local control.

Katie Averill: Yeah, I would
agree with you wholeheartedly.

I think that and Leading back
into the conversation that we

previously had about me coming
from the industry and understanding

what the industry needs and wants.

I think that's something
that our regulated entities.

Really value in the state of Iowa.

My credit union's exam team is mobile
and is based all over the state.

We get into those credit
unions on an annual basis.

We are in over 80% of our credit unions.

Sitting face to face with the
leaders of these credit unions.

I think there really is value
in that state knowledge and

pride in the state organization.

Treichel: No, go ahead.

Katie Averill: And I'll just add that
we do collaborate very well with N.

C.

U.

A.

And consider them partners.

And about a third of our
examinations are joint with the N.

C.

U.

A.

And, they have the specialists and
some of the resources that we need.

We utilize them as our partners,
although they are not the

regulators, they're the insurers.

But that's a strong relationship
that we have is with our N.

C.

U.

A.

Partners.

Treichel: Yes, indeed.

And so we've talked a little bit about
the value that the having been there

and done that the value having come
from credit unions to be a regulator

the reverse is true as well, right?

Now that you are a regulator you probably
really Have had some thoughts where it's

okay now that I've walked in these shoes
for eight years I view something maybe a

little bit different than I had when I was
had a credit union in a bank background,

but not the regulatory background.

Have you seen that to be true as well?

Katie Averill: Oh, absolutely.

I, I feel like looking back and
at 2017 when I took the role as

the superintendent, I really did
think I had a solid understanding

of the regulators rule.

But I was soon to learn that there were
a lot of nuances and different things

that really play into the success of
the partnership that we have between

regulator and credit unions in Iowa.

You're exactly right.

I think that value of understanding
the regulator and the credit union

background has really proven to be
successful in, my career here in Iowa.

Treichel: Yeah, and I saw that myself just
going from working, at NCWA for almost

34 years and then doing the podcast,
obviously, but also, doing some consulting

and having some conversations where things
were eye opening, things that I thought

I knew the reality of, I had my clients
explaining some things to me where I've

grown a lot just from the, being on
the credit union side of things, yeah.

Yeah,

Katie Averill: absolutely.

Sometimes humility is a good life lesson.

Treichel: You got it.

You got it.

Katie Averill: Yes,

Treichel: that's for sure.

Let's pivot a little bit.

Talk a little bit about NASCA.

So you were nominated by your peers the
state supervisory authorities is the, is

what we would term you all collectively?

Yes.

At SUA, the SSA State
Supervisory Authorities you,

it's a, an important role.

That NASCS has for the credit unions
and for the regulators, but you were

elected to be on the board and after
doing that for a while, you were

now the chair of the NASCS board.

Let's speak to how that all
came about how you're enjoying

fulfilling that, that role as well.

Katie Averill: Yeah, thank you.

I really, truly consider this a
great honor and privilege, and

especially to be entrusted by my
colleagues to serve in this role.

And I do give a shout out to my Credit
Union Advisory Co Chair, Brian Wolfberg,

from Visar in Jacksonville, Florida.

Probably near where you
are a little bit, Mark.

Not too far,

Treichel: that's right.

Katie Averill: The warm
areas of Florida, anyway.

And the rest of the
joint leadership board.

Really, we have a great set of people.

I think one of the unique things
about NASCS that I'm not sure everyone

understands is that it really does bring
the regulators with leaders in the credit

union system on a board that's making
decisions and moving things forward.

So that's really something that I think
is unique and gives NASCS really an edge.

over, some of the decisions that we make.

We really are bringing those
perspectives, much like the conversation

that we've had here today of the
regulated with the regulators.

I think, much like my style in Iowa.

bringing people together.

I really appreciate the real
conversations that I'm having from my

counterparts and learning from others.

And oftentimes I do pull together
regulators and groups of regulators to

get their insight on matters at hand.

And I plan in my term as the board chair
to escalate some of those conversations

and engagements with leaders in
regulation and the credit union system.

I want to be intentional about
that time to learn and listen

from other people's viewpoints.

And we've already done some of this.

I did this as a board member,
but now as board chair.

Already had the opportunity to meet with
NCOA board members and their leadership.

And of course, coming up soon is GAC.

And so there'll be some other
additional opportunities to mix it

up with credit union stakeholders.

Treichel: And you're going
to be at GAC this year.

I certainly hope.

Yeah.

Very good.

I, yes.

I I plan to be there as well.

Hopefully, I'll run into you in the hall
and I this episode will go out before GAC.

Those of you who are listening if
you don't already have your tickets

to GAC, you better get him soon.

The planes are filling up.

And if you do have your tickets, look
for Katie and I in the Washington D.

C.

Convention Center.

It's a great event.

Very important right now with what's
going on with Washington in Washington.

You hear.

rumblings of will banking
regulators be consolidated?

You hear rumblings of, what's
gonna be happening with taxation.

But when all that's going on, I
think it kind of points to the

importance of charter choice as well.

And having, when there's Dust in the
air and where will things settle,

within CUA and their hiring freeze
and these other issues I mentioned.

It's a good time to reflect on the
fact that in most states, nearly

all the states, I think 47 credit
unions have the choice of being a

state charter or a federal charter.

And it's those types of things.

Sometimes, sometimes people move
because of field of membership.

Sometimes they move for other reasons,
but but having that access that local

access where they know the people as
opposed to the unknowns that are out

there particularly right now, I guess
it's just another reminder that being

able to pivot if you're, if you're a
federal charter and you're wondering

what's going on and what the values
of the state charter System are you?

You can become a member of NASCS.

You can participate in the leadership.

You mentioned, we've talked about
you being on the board and we thought

you talked a little bit about the
leadership of the credit union board.

Could you speak a little bit
about how that all works?

And, The particular things that you
find the most value of that NASCSP

provides to the credit unions and
as well to the state regulators.

Katie Averill: Yeah, absolutely.

And just to piggyback on a comment
that you just made, we really are

fortunate in the United States to
have that dual chartering system.

I think it keeps.

all of us on our toes
and makes us all better.

And honestly, when my credit unions ask
about a federal charter, I encourage

them to explore and to look into what
and how that fits their business model.

So I think it's something that that
we encourage as state regulators.

I think NC way is knowledgeable about what
makes our charter stronger and better.

And I think collectively that makes
a better system in the United States.

But to answer your second part of
your question, NASCS has truly been

instrumental to the success of my
career as a state regulator for sure.

And I learned so much from the
depth and wealth of knowledge of my

state regulators and many of them.

Also regulate banks in the United States.

So there's, the knowledge that
they have, the things they bring

to the table with their experiences
have been very valuable to me.

And NASCS also provides an
environment that encourages All the

participants to have a seat at the
table and share their perspectives.

I think that's one thing
they're very good at.

Naska's navigates conversations
with leagues and other key credit

union associational organizations.

And of course, as we've mentioned N.

C.

U.

A.

But I think one thing that I'd like
to highlight is how well they do at

opportunities to engage and learn and as
far as their training, really, a former

colleague of mine from Connecticut,
Mario, Mary Ellen O'Neill is someone

that truly understands that the needs
and puts together a lot of programs

and trainings that are very valuable
to the credit union system and to

regulators and then great educational
opportunities that NASCS provides.

Most of those efforts are led by Dr.

Asaida Wu, and she's also out in
the field going state to state.

And for example, NASCS has a director's
college, and in Iowa, coming up at the

end of May, we have something called
Superintendent's Day, which is a board

of director only training that we put
together with some local flavor and

bringing in some national experts as well.

And then the third area I
wanted to highlight was just the

engagement that NASCIS provides.

And there's a lot of roundtables,
regular meetings with the NCUA.

NASCIS provides comment letters
and committee opportunities.

And the thing that's great about the
NASCIS organization is that they are

always relevant and not afraid to create
and recreate new opportunities given the

all and ever changing environment that
we live in the credit immune system.

I think they have that
advantage of being nimble.

And real time and accessible.

That was that's another
theme of our conversation.

I think Mark is that accessibility.

But this also reflects the great
leadership of NASCA CEO Brian Knight.

And I know that you have had Brian
on your podcast here before, but his

depth and breadth of knowledge is more
significant than alm credit union system.

So it's truly been a pleasure to
work side by side with Brian in

my new role as the Naska's chair.

Treichel: No doubt.

Yeah, he's a great resource for credit
unions for Naska's and obviously for

you as the chair there, and one thing
you mentioned too, is that since a lot

of there's overlap in some states with
the banking departments when I was at N.

C.

U.

A.

I can remember banked on life insurance.

Which then became credit union owned
life insurance that when that first

started to become a thing in credit
unions, we didn't know a lot about it

at NCOA and NASCS was educating NCOA on,
its role, how they can do it right etc.

And then the other one back then,
obviously, cybersecurity has been

an issue for a long time everywhere.

But there was the banks, I think,
and banking regulators were Back

in the day, go back 20 years, 25
years, we're a little bit ahead of

where credit unions were at in that.

And it was, Naskis was able to share
some things with NCOA that helped NCOA,

do better for federal credit unions.

So again, back to the value of the
wisdom of crowds the dual chartering

system, making the entire system.

Stronger.

Katie Averill: And if I can also
add another example of that, Mark I

do also have the opportunity of co
chairing the NCUA's Joint Supervisory

Working Group with my counterpart,
Kelly Lay, who's the Director of

E& I, Examination and Insurance.

Yes.

And that is a true example of
bringing a set of leaders together.

There's five states represented and
four of them are also regulating banks.

So back to that conversation about the
broad knowledge of state regulators

and the conversations that we have
really are around emerging issues.

challenges, opportunities of the system.

And we find that extremely valuable
to have that that joint conversation

between state regulators and the N.

C.

U.

A.

Leadership.

Treichel: Fantastic.

Glad to hear that's still going on.

And another great example
of the collaboration.

So you mentioned a few Nazca's
events that are coming up.

Are there any more?

Specifically that you want to
point out to the listeners that

might be of interest for someone
to say, Hey, that sounds great.

Maybe it's time for me.

If I'm, if I am participating
in NASCIS, but they forgot that

there was an event coming up, or
they just want to check it out.

Anything that you want to mention
that's around, around the bend?

Katie Averill: Sure.

Absolutely.

I guess the first on the agenda is GAC.

And the entire joint leadership
group will be in Washington, D.

C.

We meet the day before GAC actually
kicks off with a board meeting.

Then we continue our conversation with
stakeholders throughout the week and

have kind of small sessions where we
really just update each other on the

activities and the some of the things
that we've been talking about here

today, Mark how things will impact
in the future, what we're looking at.

And again, some of those challenges
and opportunities that we all share.

So GAC is the first thing.

And then the regulators are all
getting together in new Orleans.

In the end at the end of March
for the national meeting and some

of the we bring in some fantastic
speakers for the regulator community,

including crypto banking and
large credit union supervision.

Some of the new things that are
coming out in that area and then

innovation like the fintechs.

So that's another great
event that Naska's puts on.

And then in May will be in Charleston
for the cyber security conference.

And then moving down the road a little
bit further in September, mid September is

the State Systems Summit in San Antonio.

And that's, we're going to celebrate
our 60th anniversary in San Antonio.

That'll be a great celebration.

But the summit brings together
credit unions and regulators.

The national event is just a regulator
Convening of regulators in the United

States, but the state system is in
San Antonio, and that's in September.

Treichel: Got it.

Look, a lot of good opportunities
there for people to participate.

Katie any anything I should have asked
you today that we didn't last chance to

say a few things to the audience here.

Katie Averill: I think we've
covered an awful lot, Mark,

in our short time together.

I don't think there's anything in
particular, really just a very proud

and happy to be serving in this new
role as the NASCS board chair and

look forward to my two year term
and also bringing Iowa to the table.

I think the Iowa credit unions are
proud of Iowa sitting at the table.

And then on the other side of it, I'm
really proud to bring Iowa's perspective

to the national table as well.

Treichel: Very good.

Very good.

And so if someone wants to reach out to
you in either of your capacities, what's

the best way for them to reach you?

Katie Averill: I can share with you
my email address and that is Katie,

K-A-T-I-E, dot il, A-V-E-R-I-L l@iowa.gov.

But they can also find me on LinkedIn.

Treichel: Very good.

Katie, this has been a lot of fun.

I wanna thank you for sharing your time
today and thoughts with my audience.

Katie Averill: I appreciate time
with you as well and I sure wish

we were doing this in Florida.

It's awfully cold here in Iowa.

.
Treichel: Yes.

Before the difference between your
temperature and mine is, it's not

a hundred, but it's a big number.

.
Katie Averill: Yeah.

That's the beauty, another
beauty of the United States.

You can get on a exactly.

Being warm or being cold.

Treichel: Very good.

Very good.

And I'll see you in GAC at GAC and again.

Thanks Katie.

Katie Averill: Sounds good.

Thank you very much.

Treichel: You got it.

And listeners, I want to
thank you for listening.

As always, I hope you'll
listen again soon.

This is Mark Treichel signing
off with Flying Colors.