Credit Union Exam Solutions Presents With Flying Colors

Treichel: Hey everyone, this
is Mark Reel with another

episode of With Flying Colors.

I am here today with Todd Miller.

Todd Miller.

Todd Miller and Steve Farr.

How you guys doing in Montana?

Farrar: It's, the weather's Not bad.

Not bad.

A little cold, little windy,

Treichel: little cold, little windy.

We're recording this,
what, January 26th, 27th.

Monday, 26th Monday.

The whole country other than Florida,
where I'm at, is really cold.

It's about 80 degrees outside and
we're gonna have a cold snap's

gonna fall in the sixties here
as your weather moves towards us.

But we're here today to talk
about NCAA's priority letter.

I did a 10,000 foot priority letter.

Podcast last week when the week after the
letter came out we, the three of us were

on a cruise, the Q'S cruise with Scott
Gladden and his team at Innovations and

a bunch of credit unions from Florida
and Georgia that we just got back from.

It was good seeing you guys face to
face for the first time in a while

and meeting some credit unions.

We had some discussions there about the
priority ladder, and we're gonna talk

about the Priority Ladder here today.

In our pre-call, we said, Hey, it's short.

So we, it's that's one
takeaway we'll have, I'm sure.

But with that, guys, I'm
gonna let you do your intro.

So in case somebody's listening the
first time, and let's start with Todd.

Miller: Good morning everyone.

I was with NCUA for 34 years from
1987 to, june of 2021 I spent, I could

break my career into three pieces.

About the first third, I was
an examiner, a problem case

officer in the western region.

Middle third of my career, I was
a capital market specialist for 10

years or so in the western region.

Again, had a lot to do within
development of n CUAs NCUA's exam

programs around interest rate, risk, a
lot of the teaching priorities around

interest rate, risk, and liquidity.

The last 11 years or so of my career,
I was a director of special actions in

the western region where I supervised
problem case officers, capital market

specialist, regional lending specialist
over my career as involved with.

Helping a lot of credit unions with no
capital survive conserved a couple credit

unions, returned them to the members.

And unfortunately I was involved
with closing a number of credit

unions too, where the NCUA kind of
failed along the way to do its job.

But anyways, very enjoyable.

34 years with NCUA.

I retired a couple months and Mark
said, Hey, you want to come help

credit unions from the other side?

And I said, sure.

Sounds like fun.

And it has been.

Treichel: It has been a lot of fun.

And Steve?

Farrar: Yeah I can summarize mine
also in the thirds if my first

third is the same as Todd's.

In fact, we worked together a
lot during our first third of

our careers and credit unions.

And then I went to, followed you,
mark when you went to central office.

I started working at the division of Risk
Management and did that for 15 years.

And that one was highly diversified,
but I was really involved in.

All of the material
exposures that NCA had.

One of my duties was calculating the
loss exposure to the insurance fund.

So that made me meddle in all of
the big anything that exposed the

insurance fund to large losses.

I got to do training of
the problem case officers.

That was really enjoyable.

I missed that one more than anything.

I finished up as the vice president
of the CLF, and then upon retiring

I did a short stint as a CFO in an
NCOA conservatorship in Manhattan.

And that was my first switching
over to being on the other side and

battling the NCOA examiners that
were in our credit union at the time.

And then since then, I've really
enjoyed this ability to do

the consulting on these areas.

And like I tell everybody, it allows us to
keep our saws sharp in, in the industry.

And I think that's been
a great opportunity.

Treichel: Yeah.

Yeah, I agree with that.

All of that.

And, I had 34 years at NCA
Minnesota Dallas Concord.

The best office ever NCA
ever had was in Concord.

We closed that at, somewhere along the
line, moved it to Phoenix from Concord

to Albany to dc to Albany, to dc and and
now for the last six years helping credit

unions and having fun on this podcast.

But with that, so NCAA's letter 26
CU oh one, which means it's 2026 and

it's the first letter of the year,
NC a's 2026 supervisory priorities.

I joked in the past at one
juncture when they had 12 or 13

priorities that if everything was
a priority, nothing's a priority.

And more recently they have less and
you can ascribe to the less is more.

But then sometimes they bury
certain things into the less

and it rears the priorities rear
their ugly head along the way.

So with that let's just
walk through the letter.

There's discussions on the front end
about no regulation by enforcement,

which we've talked about here.

There's the obligatory reference to the
Genius Act, and I say obligatory because

Kyle Hoffman's big on, on that whole
arena, and I'm sure he, as chair who

signed it, made sure that was in there.

And then they, they pivot into the
supervisory priorities themselves.

And the first one listed is a broad
title balance sheet management.

Guys, what do you wanna say about
N NCAA's letter to credit unions

on balance sheet management?

What's there, what's not there, et cetera.

Farrar: Mark, I just touched a little bit
on that introductory section that they

Treichel: Yeah.

Do.

Absolutely.

Absolutely.

Farrar: Steve, I don't think we can
talk about, priorities in 2026 without

addressing, that NCOA has to do their exam
program with the big reduction in staff.

Which of course you had hoped that they
would be, focused as they said on shift

the areas of focus based on their risk
profile and appropriate what I see in

the, our fellow regulators, that they're
really clear and that they're going

to shift to focusing on what they call
prioritized material financial risks.

So they really said they're gonna be
backing off on, things like processes and

procedures and only address those items
that present the most material risk.

And that was all that they would
write their matters or crying

attention on is those big issues.

So I think that's important to
think going forward, that you're

dealing with, an exam staff that's
gonna be stressed and hopefully they

will be focusing on the big issues.

Miller: I have another
little take to it too.

I highlighted four sentences in the
whole letter, and a couple of them were

actually right before the Genius Act.

Improved efficiency in reducing
burdensome work, creating a more

efficient tailored exam program.

Seems like that process was going on
the whole 34 years we were at NCUA.

And I think.

When we were on the cruise, you
did a whole little piece and you

had podcasts on the chaos at the
agency, 27% reduction in force.

I think it boils down to is NCOA
saying we're gonna do our job, but

we haven't figured out how yet.

And I talked to an examiner
here not too long ago.

They presented the reorganization plan
to their staff in December and the

way he characterized it is there's
lots of, to be determined in all

the slides they gave the examiners.

So I think they know
what their mission is.

They're gonna focus on
doing their mission.

They haven't figured out how to do that
with the resources that are probably

not enough for them to do that in 2026.

Treichel: Yeah, said.

Yeah.

This the language here, the creating
a more efficient and tailored exam

is a nice way to say we've got some
chaos and we're in the middle of

trying to figure out what that is.

And there's clearly dust still
in the air at NCUA and we've

seen it trickle into exams.

But the good people at NCUA
are doing what they can.

And it's if this is probably a bad
analogy, but you're in a band together

and you've got a repertoire of different
songs and you show up and you decide

that you're gonna, you're, these are
the 10 songs you're gonna play instead

of, those are the 10 songs and you maybe
you wished you'd have practiced them.

If you don't, it was gonna be then 10.

But you, they have the knowledge,
skills and abilities that

they have from their, and the.

And the muscle reflex
of doing exams, right?

And you just don't have as many resources.

And you're hearing from over here
that this is your team and you're

hearing from over here that this
is your supervisory examiner.

And you go in and, you the clock ticks
and you do the exam and the clock.

It says you gotta be at the
next place and you meet with the

people and you just keep the ball.

So they do triage,
their own triage, right?

They, each individual kind of has
their own, has always had their

own risk-based assessment in their
brain on how they were gonna do it.

But with less resources
that becomes more important.

Like part of the challenge is they lost
a lot of talented long-term people.

Farrar: Yeah Todd pointed out, the
comment there that they're going to

try and do more efficient and tailored
exam programs, and we can't forget.

The NCOA did send out the notice that says
the tips on starting exam effectively.

I think credit unions should keep
that in mind and hold NCOA accountable

on those timeframes that they've
been giving the four week notice.

And, so that your examiner is following
that 'cause that will make for an

efficient exam where the examiner isn't
doing that, that as an impact on them.

And you and and this letter
clarified that, which is great.

Another thing I, that happened in
October though from the other financial

regulators, they just thought,
take this opportunity to discuss.

They have finally, for the first time
defined unsafe and unsound practice.

It's always been a little
bit of a nebulous concept.

It was in some case law, which is just
really difficult, but they did it.

It's pretty short definition.

I'll read through it or because it
won't take but a second is defined as

a practice act or failure to act alone
or together with other practices, acts,

or failures to act that is contrary to
generally accepted standards of prudent

operation and has materially harmed the
financial condition of the institution

or if continued is likely to materially
harm the financial condition of the

institution or present a material
risk of loss to the insurance fund.

So it's a simple definition,
but we finally, have one,

Treichel: so they've, I remember
that having been proposed

by the other regulators.

So it's finalized now.

Farrar: It's it was in a a proposed
rule, but I think because of it

being there, that would be a standard
that would be used going forward.

Treichel: Sure.

It, and as great it is to
have that definition, it

probably provides some clarity.

It still comes down to
interpretation, right?

You can't, no matter what year, what
words you provide, you can have a

little bit of wiggle room around.

That'll be interesting to see if NCOA
does anything to come up with their

own definition or, copies that one.

Anything else?

On the paragraphs that I summarized before
we get into the balance sheet management.

Miller: Nope.

I have a lot score.

What does this mean?

But those are for the end
after we're done with this.

Treichel: Okay, very good.

Steve, balance sheet management, we've
got loan growth has moderated in recent

years while loan performance has declined
the overall delinquency rate, enrolling

12 month loss rate within the federally
insured credit union portfolios at

its highest point in over a decade.

Any anything there that jumps
out at your number crunching?

I.

Farrar: We don't generally
agree with that statement.

Miller: Yes.

So it's like we had a client, they
were growing about 8% a year and

said, your growth is high and risky.

It's the same thing in this statement.

That's almost a summary of what
they used in last year's letter.

And it was true that loan quality
was deteriorating over 2024.

It's not true in 2025, it
stayed virtually the same.

And so they imply that asset
quality is deteriorating, but

that's not what the numbers show
for the first nine months of 2025.

Treichel: The stats don't support it.

It's kind I remember one time
when, you know, when NCA says

they're gonna renew the 18% rate.

For federal credit unions to charge, they
have to show that they have to show some

instability or rates, or that rates have
gone up and down and tie it to some data.

And I remember one period they
had, there was like one blip where

they able to say that it qualified.

They're they're making a statement to
make sure people are watching their

loans, but the stats don't necessarily
report what that sentence implies.

Is that what we're saying?

Miller: Yes.

I think it's interesting.

You look at last year,
they laid out specifics.

They talked about loan underwriting
collections, concentration, risk board

reporting on significant programs.

That was in last year's letter this year.

As I said, we're just gonna pick
on whatever we think is going

wrong in this specific institution.

They do mention credit risk concentrations
again, but overall they don't.

Mention anything specific and at
the end of the day, credit risk

is what costs the insurance fund.

Most of its losses and they're
basically gonna say, we're gonna

pay attention to credit risk.

It's interesting, when you look down
there at Lending Resources, those

are all the same resources they
cited last year, with the exception.

They took a couple out about
adjustable rate arms and they also

took out a reference to evaluating
real estate modification programs.

And it's interesting that you take that
out when you know they're concerned about

real estate lending and really residential
real estate and commercial lending were

the only loan programs that really grew
through the first nine months of 2025.

Treichel: Interesting.

Steve, any thoughts on that?

Farrar: Yeah, I looked at, they're
gonna focus on, the credit risk

management underwriting standards
and loss mitigation programs.

Those are areas that I think has credit
unions moved towards u using data that

they have and the ability of AI and stuff.

I think there's gonna be strong
improvement in that area and that credit

unions should be quicker to respond to
what they're saying in general membership.

So I, I am optimistic in that area
as the early recognition of credit

problems will help in this area.

And I think as you use good systems to
do your underwriting, that loan quality

will continue to improve as long as there
aren't kinda external factors that aren't

really related to credit that don't affect
the system, whereas like that issue with

maybe having a 10% thing on credit cards,
that certainly changes the whole model.

Treichel: Sure.

Farrar: So I think people are probably
gonna be I think we see improvement in

credit risk management in the industry.

And I think this will be a big year.

For credit unions to be able
to improve that process.

Treichel: And of course the 10%
credit cards you're referring

to is president Trump's mandates
last encouragement that, that be

something that would be put in place.

I did a full podcast on that,
and obviously that would take

an act of Congress and it
would impact a lot of things.

And it's just not gonna play out.

But it, it's an interesting
interesting sidebar of all this.

Now, one sentence that caught my eye
on this was, when lending, servicing,

or collection functions are outsourced,
examiners will also assess the third

party risk management practices as
appropriate NCA with loan participations.

But even them linking it to
like outsourcing of collections,

the collections kind of
word caught my eye here.

I'm wondering if they've seen
some things where collections have

been outsourced and they didn't
like how it may have been handled.

Of course, we know there've been a lot of
different scenarios where participation

loans have created some challenges and
how they handled those with third parties.

Any thoughts on that, what I just
said, or that sentence at all?

Miller: Oh, no.

There's always been credit unions that
have outsourced parts of their collection.

Often, most often you see they
prompt that early piece where you

know, it's 10 to 60 days or they.

Throw out the backend piece
after we charge it off.

And there, there has been some broads
over the years in areas related

to outsourcing collection actions.

There has been consumer complaints,
they're small and very isolated.

And over time, this is something
that's just, many credit

unions have found it effective.

There's always been a piece of the
industry that has outsourced collections,

either on the front or the back end.

It'd be interesting to see if more
of that goes on in the future.

Because of various debt collection
practices, you have more

flexibility to keep things in house.

There's things you can do in
house that you can't do when

you outsource it like that.

Treichel: Great point.

Miller: Interesting observation, mark.

Treichel: Great point.

So next category sensitivity
to market risk and liquidity.

I think if we only had someone
who was a former capital market

specialist or supervised capital market
specialist, he might have something.

Oh, wait, no, Todd's on the line.

Todd, what are your, what's
your thoughts on sensitivity

and market risk and liquidity?

Miller: It's been on the last
couple supervisory letters.

It's interesting.

Last year they couched all of this
under that category of earnings

and the impact on earnings.

I can tell you what we've seen is.

NCA has got their supervisory test.

There's a huge focus on,
their NEV supervisory test.

When you look at the numbers though,
across the industry, interest rate

risk doesn't seem to be an issue
or it's not increasing anyway.

It's actually ebbing a little bit.

Liquidity seems to be pretty good
across the industry, but NCUA is

always sensitive to liquidity.

I think they've always been
overly sensitive to liquidity.

The agency just seems to be
risk averse to liquidity risk.

They don't tend to like borrowings
and things of that nature.

I don't see a lot of change in how NCA
is gonna look at liquidity and interest

rate risk, to be honest, going forward.

It's in the letter most years.

I think it will always be their
liquidity risk, especially can

have impacts on the insurance fund.

I think the interest rate risk
is something that's interesting

'cause it's part of strategic risk.

Generally though, you can fix
interest rate risk by spending a

couple basis points of capital.

Credit unions almost never fail from it.

They get hurt by it.

And sometimes when credit unions
put themselves in bad interest rate

risk positions, they make really
bad decisions about credit risk

to fix it rather than admitting
they have a problem and fixing it.

They try and mitigate it by taking on more
credit risk and that can cause problems.

I think it's just a bigger boogieman
than the agency makes it out to be.

At the end of the day, we can genuinely
work through interest rate risk.

Liquidity risk is a little bit different.

Like Steve says, the models for
forecasting liquidity risk, we see a lot

of findings directed at people's tools
for forecasting their liquidity risk.

Hopefully over time
those get better as well.

And we do see lots of doors
and exam findings, targeting

liquidity forecasting models.

I think that will continue, but I don't
see this being any more different than

it has been the last several years.

Treichel: And generally we're seeing
less of it in our conversations and

clients where they, when rates shot up
500 basis points there was more of a

shock and awe exam approach than now.

There's still's coming up, but
not out, not in every institution.

Miller: When rates shot up, and then
you'd have a model that does another 300.

Of course everyone's gonna be
failing and that's why they got

rid of the extreme category.

And I think another reason
this is moderating, and this

happens, every rate change.

When rates change, you have to adjust
your shares right away and loans catch up.

And we've seen that with the rate change.

Everyone's margins got compressions, NIMS
got compressed, earnings got stressed.

So there was a big focus on it.

But really in 2025 now the loan rates are
catching up and that interest margins are

expanding again and looking a lot better.

Earnings are improving.

So there's gonna be a little
less emphasis on that.

I'll just throw something that's maybe
not in this letter that probably should

be talked about in earnings, and maybe
it comes up in the next section, is there

is a troubling trend in credit union's.

Operating expenses are growing
relative to assets and.

That's been going on for a couple years.

That is troubling long term
to see expenses rising.

And you're not seeing that in
their competitive industries.

The banking industry, their
expenses aren't going up.

Craniums expenses are going up.

Can,

Farrar: can I jump back?

Just one more thing on liquidity, Todd.

And it's one i one almost
direct towards you.

It has to do, they had a message
in there on diversified funding.

And I have concerns mainly the,

because the competition
is increasing daily.

There's like 15 banks that were chartered
in the last year and it was funny.

They referred to them as novel.

In approach.

So certainly that's gonna
increase competition.

And usually in regulatory word,
the word novel is very scary.

But they're, they've streamlined their
approval process for new banks and

Miller: oh, two of those new banks
were Ford and General Motors.

Farrar: Yeah.

So that hits on both sides on
the lending and the savings.

So there's, increased competition from
private credit and non-bank entities.

I just, you're,

Miller: if,

can you hear me mark,

Farrar: of these big generational
differences into how they approach.

Their savings and it's huge between
each one of 'em and so credit unions

have to really be on top of that
and how they're reaching out to

try and build that share portfolio.

Treichel: Steve, you, Steve,
you were on fire there, but

you were cutting in and out

Miller: so Michael from Olden Lang talked
about this on the cruise last week.

He kinda had a whole presentation
about, where do you find your members

in this transfer of wealth and how
do you keep them when you find them?

It's a, so first off, look at 2025
credit unions paid down, borrow money.

They did actually pretty good
at collecting funds in 2025 and

diversifying their balance sheet.

But long term, yes.

Steve, this is gonna be a big challenge
for all the CEOs is where do you

get your new members and where do
you get your funding in the future?

I have a population of
two, a son and a daughter.

Daughter, fairly loyal, still has the
same bank account she opened 15 years ago.

Son, no loyalty at all, man,
entirely on rewards program.

And when he doesn't have a rewards,
his money is somewhere else.

A lot of the younger folks are more
focused on investing as opposed

to leaving money in institutions.

So funding sources are a big challenge.

And how do you get new members and
how do you get the new generation

to come into your credit union?

And being an orphan, meaning
I've lost all my parents and my

wife have lost all her parents.

That money didn't, their money
didn't stay where it was when

they passed it on to the children.

I think that is a big challenge long term
for the whole industry is how do they

gain new members and new deposits from
the next generations coming up, who's,

they have more information available
at their fingertips at the internet.

So it's not the branch down the street,
it's, Hey, where's the best deal online?

And it's a huge challenge
for credit unions.

They're still gonna bring in members
with branch networks, but nowadays

you can move across the country and
you don't need to change your bank.

Her daughter's in Nashville and she's
still, keeping the same account.

She opened here in Billings, Montana,
because she's got remote capture on the

checks does everything with Bill pay.

Not a reason to move.

And then I have a son, he'll move
in a heartbeat just for a reward.

No loyalty to anything.

So I think that's a big challenge
for the industry coming up.

We don't talk about it.

Neither of us are experts in it,
but I think social media presences

is gonna be huge to stay engaged
with the generations coming up

Treichel: In 15 seconds.

No advice

Miller: to co clients on how to do that.

I just know they have

Treichel: to do it.

Yeah, you just know the war is coming
and as you talk about that I grab my

phone 'cause there, there's there's a
podcast mentioned here on occasion, but

it's called FinTech Takes And ironically
the host is a guy named Alex Johnson

who lives in Montana just like you guys.

I don't know, there's something
in the water there with all these

smart people in Montana, but
he's gone down some rabbit holes.

He's a.

Hi.

Hi.

The podcast if you like podcasts,
I'm telling you this, you guys

this, but to the listeners the
fintechs Takes is a fabulous podcast.

They have one episode a month called, this
Is Not FinTech, ADV Investment Advice.

And then they talk about really cool
investment options out there, but

they preface it with Don't buy this.

We just think it might be cool anyway.

Every once in a while he'll go down a
rabbit hole on gambling, sports gambling,

and he, without rambling about the
problems that's creating, and every ad on

the NFL games are tied to, the gambling.

But he talks about the fact that's
burning up savings ability, right?

So it's a, just another way that
financial institutions are not

able to get access to funds because
people are burning up the money by

losing money, gambling, and they're.

There is a sister podcast to that
called Bank Nerd Corner with Kia

Haslet and those two also are on each
other's podcast, but check those out.

Any thoughts on sports gambling?

And Todd, I see you got a follow up point.

Miller: A couple things.

Like the last couple big bank
failures were liquidity crisis.

Yeah.

Triggered by folks on social media.

So basically you got crowd knowledge
spreading very quickly, which

triggered those liquidity runs.

The gambling thing, and you can edit
this out if you want, there, there's

a couple interesting pieces to this.

We have a lot of gambling in Montana
and when I was an examiners to go

through overdrawn accounts and you
would see people got a paycheck and

over two days they spent that whole
paycheck, ATM withdrawals at casinos.

And then the other side of that, I was at
a credit union also here in Montana, and

the collector comes up to me and he says,
is there any problems if I go like on

payday to the casinos to go collect money?

And it's just I don't
wanna hear about that.

Don't tell me about it.

I don't wanna hear about it.

But you go collect your money at
the casinos because that's where

your members are spending it.

I said you can edit that out.

Probably not appropriate
for your collectors to be

in casinos on paydays, but

Treichel: I'm gonna leave it in Todd.

I'm gonna live on the edge.

Miller: In his case I said, Hey,
I don't wanna hear about it.

I'm not telling you yes or no.

Now the answer is probably no 'cause
you go select money 'cause I'd rather

not deal with your charge off problems

Treichel: is collect the loans.

Miller: So we digressed away from the
supervisory letter, but that's okay.

Treichel: We did, but that's okay.

That's when it gets more fun.

Earnings and capital.

Earnings and capital back on

Farrar: the operating expenses there Todd.

That

Treichel: Yeah.

Yeah.

Back to operating expenses.

We, so we talked about a little bit
about that issue and the challenges and

some of it's inflation, some of it's
credit unions needing staffing to be

compensated so that they can keep 'em.

But that's a pressure point for sure.

Anything else on earnings and
capital adequacy or the expense side?

Farrar: Mine on that is we'd like to
see credit unions put their capital to

work and we think that's a good point.

Not necessarily shared by every
examiner who are risk averse.

So they're people too, but what we
think, Todd, how much of the increase

in expenses do you think it's from
replacing legacy systems to, scale up

and increase the use of technology?

Miller: I think it's a little
bit of all of it, Steve, and

it depends on the credit union.

Certainly amongst our clients,
we've seen a number of them

have went through conversions.

You see a lot of credit unions that are
sitting there at that $8 billion range.

They start spending a lot of money
to get rid of for the leap to 10

billion when their regulatory burden
and all their capital planning and

stress testing becomes much greater.

They get a second regulator
thrown into things.

Certainly during COVID you get a
hiatus on these conversions and moving

forward when everyone's offsite,
there was a holding pattern and

people are playing catch up on stuff.

I think some of it is you just had an
explosion of inflation and now you're

catching up with some of that with your
staff salaries and things of that nature.

Insurance costs are escalating.

So I think it's just a
little bit of everything.

And, a lot of credit unions and if their
earnings are positive, their mindsets

aren't necessarily focused on that.

And I know when Steve and I, we
said we started out together in

the late eighties, early nineties,
NCUA was hyperfocused on expenses.

And somewhere in the early nineties,
92, 93, as examiners we're told

to not worry about expenses
and told to not look at them.

And that culturally has remained there.

If earnings are present,
examiners aren't supposed to

have this discussion on expenses.

But we've seen with clients
here recently that they have.

And they have started picking on
expenses in select situations,

sometimes unfairly even.

But certainly as the industry,
individual boards, credit unions, you

need to keep an eye on those expenses.

And it's a matter of can you grow
your interest, income and fee

income and stuff to overcome that?

And it's back to what you said when
you used the word scale, Steve.

You gotta be able to scale up to keep
that expense number under control.

Big challenge.

Farrar: Yeah.

I know one of the other things I've
been reading about is that how do

you diversify that income stream?

Is this we can do that
when interest rates change.

You can gain fees on refinances
or real estate loans.

But there, and I think we're
trying to look towards new

sources to diversify fee income.

I think some of that does come with the.

Technology innovation that we've
seen in some of our clients

Miller: are you create new loan products.

Like one of the interesting things,
if you look at the real estate

lending, you're seeing a lot
of growth in hybrid type loans.

Again not your standard fixed rates,
not your standard arms, but the

hybrid loan categories are growing.

Again, I think that's a lot of credit
unions that are trying to put real

estate loans on your balance sheet.

I know even when I was still an examiner
when I, before I retired in 2021,

you're seeing a lot of this on the
West Coast where people were creating

their own year real estate products.

Didn't meet secondary markets and terms,
a lot of the credit did, but they were

trying to create unique products to
reach out to members, make housing more

affordable, but still create a product
they could keep on their balance sheet

for interest rate and liquidity purposes.

You're seeing AI unsecured type lending
coming about, here's AI jumping into the

marketplace, creating a new type of loan.

But certainly, folks have to pay attention
to cost and what's costing them and

who's paying for it, who's your members
that are generating profitability for

you versus those that are not, and how
do you make those that are not become

profitable or break even type people?

Big challenge.

Farrar: Yeah.

My hope is that the regulators, don't
harm the ability of institutions to

foster innovation in the industry.

Miller: I had some summary
comments about that at the end.

Farrar: Let's revisit
it also it's worth it.

Treichel: I think you're implying that
we may have seen that on occasion.

It's

Miller: Steve said, there's a risk.

I'll just wait till the end.

Treichel: That's good.

You're, this is what you do to make
sure the listeners wait all the way

till the end for that final point.

So it is gotta make a good one.

All right.

Operational risk management.

Miller: We kind of skipped
earnings and capital.

I wanna just say one thing.

Treichel: Earnings and capital.

All right.

Back to earnings and capital.

Miller: We were talking about
liquidity and it bled into it.

It bled because in the prior years
those were combined this year

they separate 'em a little bit.

But I think it's interesting in
what they took out of this letter.

'cause in the prior year they had
guidance citations on risk-based

capital planning and stress testing.

Net worth ratio and UNK corrective action.

And they took those out of this
letter, but they took 'em out of the

letter right at a time where in 2025
we were seeing doors and findings

on capital planning and justifying
your capital levels and sensitivity

testing on your capital levels.

And they took those
little pieces out of that.

This year, they're still in the wording
somewhat that examiners will still assess,

earnings, make sure you have capital.

But last year it was very focused
on capital in the letter, they

had guidance specific to capital.

We've seen a lot of doors and
findings on capital, and I think it's

interesting that those little pieces
were removed from the letter this year.

Treichel: Yeah.

It'll be inter and then that, when, as
you're saying that, I'm thinking the

priority is the priority, but on the
front end they talk about risk focused.

And that they can pivot
to wherever they want.

And situationally those things will
still get brought up if NCUA and

your exam team thinks they need
to be these are the priorities.

It doesn't mean you're not gonna have
to deal with other risks and every

other type of risk, but great point.

Todd.

Steve, any thoughts on that?

Farrar: No, I'm, that's good.

Treichel: Excuse me.

I'm gonna have to hit the cough button.

Operational risk management.

We got payment systems made
reference two, two a one sentence

paragraph on payment systems and
another sentence on payment systems.

Then they hit payment systems
in the last last sentence there.

I think they're worried about they,

Miller: the justified keeping their
payment systems specialists that

they just added a couple years ago,

Treichel: Or they're worried
about Venmo linking to PayPal and

stable coins and all the different
clearings I was listening to.

And

Miller: Zelle.

And

Treichel: Zel and how all
of those link together.

And I'm, I have an accounting
degree, but I'm glad I don't have

to balance anybody's Fed account.

Miller: We talked about

it's right at the tip of my thumb, Venmo.

On an earlier podcast, the number
of young people that use Venmo

accounts, it was a huge percentage.

And I don't have those stats
'cause I didn't think we

would talk about that today.

But you mentioned the social media
aspects to the Venmo accounts and

the controls you need with that.

The big scheme of things with payment
systems here is you just have all these

non-financial institutions entering
into this payment systems arena.

And, I think the explosion
of your cryptocurrencies have

a lot to do with that too.

You need to create ways to
transfer money here and there.

It's because people like my
son have money in 15 different

banks 'cause of reward programs.

How do you move money around?

Let's not use the bank at all.

Let's just use a third party thing.

I do know the last car they
bought, they use Venmo.

Even though that's limited to,
at that time it was limited to

$10,000 at a pot probably to
get around the BSA requirements,

Treichel: know your customer.

Yeah.

Yep.

Miller: It's just an interesting thing
and the risks are growing there, and this

was all under the cyber in prior years.

This was under the cybersecurity title,
which they don't really mention this year.

They just mentioned this payment
systems and, BSA is a separate type of

thing, and BSA has always been on these
priority letters in one form or another.

And I think a lot of that is because
they have enforcement requirements

that in agreements with other
regulators that they have to follow.

Treichel: Along a lot.

Yeah.

The, we have BSAA couple sections
down, but yeah, good point.

On that, Steve any more thoughts on
the, this topic, payments, payment

systems, et cetera, before we pivot?

Farrar: Yeah.

I'm gonna drag out my dog ear
proposed rule on corporate

governance that I'm always grabbing.

And, it talks about, the importance
of internal audit programs.

And I think those are gonna continue
to become more and more important as we

move into adopting these technologies.

I think, it needs to be a priority in
your institution that you can say we are

very comfortable with the reviews that
we're doing with these payment systems

and even our compliance with the, we'll
talk about layer compliance, but the

fraud prevention and detection I think
those people are gonna be real critical.

And those that, that, that department
also provides you a great source for your

eventual people moving up in management.

I, that, that has a lot of unintended
positive consequences and not

having a proper internal audit has
terrible, unintended consequences.

Treichel: That's a great point.

Great point.

Next up, fraud.

Miller: Now we can talk about fraud,

Treichel: fraud protection,
prevention, and detection.

This fraud.

Fraud they bring up every once in a while.

I, I used to do a chart.

I don't have it here in front of me, but
the priorities there's perpetual, there's

occasional, and there's new the perpetuals
are like the BSAs and asset quality.

And up until this year, the perpetual
was a separate category on cyber, but

fraud is an occasional, it pops up every
once in a while and I don't know if they

just say, Hey, we haven't talked about
fraud for a while, or there's something

going on at NCA, but thoughts on fraud
prevention and detection as it relates

to the letter and or anything else?

Miller: I think there's a couple
pieces of this is the insurer.

NCUA is probably worried about fraud
that impacts the failure of the credit

union, but on the credit union side,
you have to look at fraud is how do

we protect our members, and here's
the thing about technology is the bad

guys are always the early adopters,

Treichel: right?

Miller: And you mentioned you were
telling someone on the cruise, about

how you used an AI to create your
voice that sounded close to yours.

Some people wouldn't be able to,
people that know you would be

able to tell there's maybe not.

There's a little fraud, whole AI things
where they'll call you and it's the whole

speaker and, and how do you protect your
members, especially your older, less

technology members from getting scammed.

And it might not be the credit
union's fault at the end of the day

from a legal standpoint, but from
a strategic reputation thing, it is

going to fall on the credit union.

If you let one of your members get scammed
out of 40, $50,000 or what have you.

And I think the big challenge for credit
unions and the fraud thing, it's not only

to protect against fraud from your own
employees, but the bigger challenge is

how do you protect your members from all
the schemes going on out there today?

Treichel: Yeah, great

Miller: point.

What kind of tools do you have
in place to protect your members?

That's a big one.

And member retention is important
and this is back to the social media

thing, of grandma gets scammed and
granddaughter starts putting a thing

on Instagram or the TikTok or what
have you, that has implications

for you and the community and.

And your reputation risk.

So you know that's, I think, probably
one of the biggest challenges

for credit unions is how do you
protect your members from fraud?

NC is worried about the credit
union doesn't fail because

an employee steals money.

I think the bigger challenge
for management is how do

you protect your members?

Treichel: And along those lines,
over the weekend my wife was looking

at at Twitter slash x and she
said, Hey, look at this situation.

It was someone talking about a
credit union somewhere in the

Midwest saying, Hey my, a relative
of mine is saying is reaching out to

you saying that they don't have an
account, and they do have an account.

And there was some references to
funds being turned over to the state.

And I'm going there are achievement
laws, so if it was a dormant account, it

can, it could be tracked over that way.

But then also it went on to imply
that they'd reached out to the

state and those funds weren't there.

And there it was, on this particular
financial institution's Twitter account.

And there was really good responses from
that institution saying, Hey, reach you.

You can reach me at this number.

Let me help.

But the struggle is real.

Farrar: Yeah.

I would say if you, how would
you respond to this question?

How are you rolling out smarter
controls that strengthen account

security and accuracy, though?

Treichel: Is that from
your dogeared risk report?

No.

Farrar: No.

It's not my own thought, but it
was when I found and found useful.

Treichel: I like it.

I like it.

All right.

Fraud prevention, detection.

Anything else before we pivot into
what's not in compliance or what

is in compliance, which is BSA?

Miller: We talked about it.

They have responsibilities to
other agencies to enforce it.

They have compliance people.

It's always been part a required
part of exams to look at BSA

and those risk assessments.

And like Steve came back to,
one of the things NCOA looks

at is they wanna know credits.

Have you done your own
risk assessment on this?

And how good is that risk assessment?

And that plays into your risk
management process, into your

internal audit processes.

And this is one where, just having
conserved credit unions, it doesn't

get talked about a lot, but you get
sideways with fend and they can issue

fines really quickly, that can become
significant really quickly too.

Treichel: Yeah.

The math can, a lot of times they
end up not actually collecting the

fines, but the fines can be, scary
to the point where it can impact

solvency and or your capital category.

Even

Miller: in my conserved credit unions, I
turned this over to NCAA's legal counsel.

It's man, go talk to the fence end people.

We can't afford to pay it.

NCOs general counsel did a pretty
good job of getting fines mitigated

or getting them negotiated down
is as long as we got things fixed

in a very short period of time,

Treichel: yeah, we were able to argue
because we conserved it and we are, and

the federal government's now in charge.

There's no need to do the fine.

And that worked a few times as well.

Not that's a reason to conserve,
but it, the conservator helped.

The conservatorship in that instance
helped us save the reserves for

the credit unions, its members.

And then of course, obviously
the fund on the backstop.

Miller: In my case, it was always, I
found out about 'em after we conserved

that these fines were hanging out there
or sometimes one times we self-reported

a problem that we found and then
they find us for self-reporting.

We weren't complying and
how do we fix it anyways,

Treichel: that sounds like the internal
audit staff that Steve says people should

have at their credit unions go into the
credit union, go into the examiner saying,

we don't want you to have any surprises.

So here's the things we're dealing with.

And then their attachment
shows up in their exam report.

Haven't had that.

We've had that.

We've had that happen more
than once, I think in 2025.

But I digress.

B, so the other takeaway here is usually
this would say consumer compliance

and we're gonna look at this and we're
gonna look at this and we're gonna look

at this and we're gonna look at this.

And oh, by the way, we always
have to look at BSA, but because

it's not a democratic led.

Todd Harper led letter to credit unions.

It's a Republican led Kyle Halman
led letter to credit unions.

This is the lightest touch there's been
on consumer compliance for many years.

Even other republicans had more on
consumer compliance than this letter has.

Fair lending exams, other things,
and, you've got the CFPB gutted

this administration is not
consumer compliance friendly.

And on that pendulum is swog
about as far as I've ever seen it.

Any thoughts on any of that?

Miller: I'll throw a guess out there
and you could probably tell me in

your time as executive director,
whether my guess is right or not.

NCOA is responsible for enforcing a, a.

A multitude of these con
consumer compliance regs until

Aranian hits $10 billion.

There's always been the question
at one time, NCUA used to

have compliance examiners.

One of our first RDS and supervisors,
Steve, Bob Blattner, Dan Murphy, started

NCA as compliance examiners in Rose
to be directors, regional directors.

There's always this question, do
you bring compliance examiners

back into a, has not done it.

So I think we've always rotated,
focusing on different aspects

of it for a couple reasons.

One, it keeps the credit unions
focused on it and two, it's a

way to train your examiners.

You can't train them all to be
compliance examiners, but you train

them on two or three things this year
and two or three things that year and

it keeps the generalist aware of all
the consumer compliance regs without

NCUA hiring a compliance examiner.

But I also thought that
was the intent of that.

It just keeps people generally aware.

I would say my career as an examiner,
a lot of the compliance issues

you find them as you're doing
something else, not because you're

looking for them specifically.

And by having a rotating thing, it
just rotates your training, keeps your

examiners up to speed, avoids this whole
issue of hiring compliance examiners.

So you, as an executive, I don't
know how close am I being Right to,

that's the why they did it or not.

That was just my kind of guess

Treichel: I would say that you're
closer to right than in the,

your roughly correct category.

If you, I've made that reference
to someone at NCA who used to

say the term roughly correct.

As a little squishy you're much more close
to the reality of what it is that you see

on the seventh floor when you're trying
to figure out what should be in there.

You rotate it through key people
fresh and the oth the other.

Just pivoting the, there, there's a lot
of good league programs, there's a lot

of good America's credit unions program.

Nafcu used to dirt and do certain things.

Credit unions would actually train us
because they had other good sources.

The examiners would learn a lot from the
credit unions until you saw something

that went wrong, perhaps because
of a lawsuit, et cetera, et cetera.

But yet the and then Todd Harper
was contemplating and I think did

start doing some separate compliance
exams under 10 billion, as a prep

to getting ready for 10 billion.

And now, oh, here, by the way, the
CFPB has responsibility for over

10 billion on consumer compliance,
yet they don't have any staff.

So it's interesting times for sure.

So we're, I'm to the letter part
where it talks about the conclusion,

which means we're to the end
where we're gonna talk about the

other fun stuff that we deferred.

Steve Todd,

Miller: your favorite, though?

It does say, Hey, record your
exits and record your jcs.

Treichel: It does, yes.

Miller: Some of that
sentence I highlighted.

Treichel: I'm glad you that's one of
the three sentences you highlighted.

And again, Kyle Halman was a big
proponent of recording your jcs.

And he does give the hat tip to the
fact that some states don't allow it.

We've been involved in situations
where our clients do it.

We've recommended doing it just because
it creates the actual official record.

And I think the more com, the more NCAA
has seen people doing it, they've become

more and more comfortable that it happens.

And you're going to have less of a
chance of some rogue cowboy examiner,

although a lot of those probably
retired going down and saying some

things that maybe they, they went,
beyond where they're supposed to.

So it does create a, a
clarity of what's said,

Miller: other rogue examiners will appear.

I don't care.

When you have a thousand
employees, there's always gonna

be a few rogues out there.

Treichel: Yeah, it's, that's a fact.

Life, I always say this
life is a bell curve.

Whether it's going out to dinner or
whether it's the result of your NCOA exam

or whether it's how well a credit union's
doing in complying with the regulation.

Everything tracks back to that bell curve.

But

Miller: one of my other duties,
one of my other duties, I was

a director of special actions.

I also sat on NCA
Supervisory Review Committee.

We dealt with credit union appeals,
and let's just say if you ever go down

and appeal a path, having recordings
could be extremely helpful to your case.

Great point.

And it makes that committee's
job a hundred times easier.

Treichel: Great point.

And I'm sure you saw some instances
it was like, whoa, that was said

that then we're gonna vote this way.

Miller: Always surprises when
you sit on those committees of

things that actually went on.

Treichel: Great point.

What other final thoughts here
on this pod, on this topic or

other general thoughts, guys?

Miller: You opened the crews with
a session on the chaos at NCUA,

and you've talked about this on
a lot of your other podcasts.

And you have this conversation with many
of our clients at the chaos at NCUA and

Steve mentioned something, and I have this
in really big letters at the bottom of

my sheet, big box, it says, risk adver.

Can I get it till the camera?

Can you see it?

It disappear on you.

Yeah.

Anyways, there's a big box
at the bottom of my paper.

It says risk adverse.

And, here's what kind
of happens that NCUA is.

You start out as a new examiner you're
nervous about all the responsibility

it's laid on your shoulders.

You tend to start out your career as
a very risk adverse person, and then

depending on your general nature,
you become more comfortable with risk

and how it's managed and controlled.

Over time, you understand long-term
implications that credit unions,

if they're gonna remain here as an
industry, they need to be in innovative,

they need to take some risks.

And you kinda learn, here's how do
you help them manage and control

risks with new programs and things.

And then you have other examiners as
they move through their career, that

risk aversion never, ever leaves.

And they even end up in management
positions and they're still risk

averse, but the whole part of the
NCUA, they've lost 27% of their staff.

And you've always had this
kind of balance scale.

You've got people that are comfortable
with risk, people less comfortable.

And I think a lot of the people that
have left were your longtime employees.

And those are the people that were
probably more comfortable with risk.

And so now you've got an agency,
we're on the balance scales.

A larger proportion of their staff
than ever are gonna be risk averse

type people and risk averse people.

They try to do a CYA and make sure
I'm not responsible for anything.

So how does that play out
here with what's going on?

In the regions?

The people that have left, it's
not uniform across the agency.

You've got a hodgepodge of, this
region lost more supervisors.

This one lost more specialists.

The interesting thing is, there's
no public information out there

as to how this has played out or
who's left or what's going on.

It's interesting.

NCUA hasn't done any
public podcasts on that.

They haven't done a podcast
on this supervisory letter,

which they've done in the past.

Treichel: They're

Miller: doing one late, no question.

Treichel: They're doing one late February.

They're gonna,

Miller: oh, is that right?

I missed that email.

Treichel: 17.

But

Miller: anyways,

Treichel: 17% of the year I'll be
gone and they're gonna brief it.

And I touched on, I mentioned this in
oh, in my emergency podcast, I sent you

guys my cool new emergency podcast music.

I I appreciated your
thumbs up feedback on that.

But in that podcast I said at
the board table, they said, we're

doing something in February.

And I channeled one or both of
you and I said, hopefully they do

more than just read the letter.

'cause some of their recent podcasts have
been just, we will read you the letter.

Thank, do you have any questions?

And then the questions sometimes
du lead to some discussion.

But anyway, all right, I digress.

Where were we?

Miller: So anyways, I think what's
gonna happen is because you're

gonna have this CYA thing, they
talk about, individual exams.

Let me go back to the front of the
letter where they say focused on,

anyways, somewhere in
here they have a thing.

We're gonna basically focus on individual
characteristics of credit unions.

What it really means is they're
gonna be trying to find outliers.

And I think what's gonna happen
is if you look around, NC a's got

all these risk reports, they got
these things called rate reviews.

A lot of these are very static.

A lot of 'em have false positives.

So even though you have a national
supervision policy manual, which they

tend to quietly be changing without
talking to the public about separate

issue, you're gonna find that almost
all the risk trends are noticed in the

regions before they're noticed nationally.

And even though you have these
national risk reports and

rate reviews, all the regions.

They generate their own risk reports
based on what they're seeing and

they see aggregate exam findings
way before the national office does.

So I think what you're gonna
see is you're gonna start seeing

some differences in the regions.

'cause the regions are gonna
start getting more involved

in their own risk assessments.

Credit unions at their supervisory
level, they're gonna start driving.

What happens within these credit
unions, when you cut off time like

this and they don't have resources
to do their job, you're going

to start seeing the CYA thing.

So they're gonna lower camel ratings,
they're gonna put doors and EFS

in as an abundance of caution.

There's gonna be less negotiations
with credit unions about it.

They'll start addressing symptoms, the
issues, and not really the root causes.

The problems, and this goes back to
something that Steve said earlier

is, when I was a director of special
actions and my staff wrote doors, one

of the first things I was looked at
is this gonna do more harm than good?

Because the last thing I wanted
to do is see a door finding

that does more harm than good.

It addresses a problem, but
does it create bigger ones?

I think we're gonna see more of those
because they're cut short on time.

They're gonna address the symptoms as an
agency just because of all the chaos going

on, the experienced staff, they missed.

We're going to see more doors and findings
that do more harm than good because

they're gonna be trying to do a CYA, and
I think they'll be building a case for

that with camel ratings and things that we
don't have enough resources to do our job.

Exam point's gonna go up, ES are
gonna be complaining continually.

I don't have a resources to do my job.

And and it affects everyone.

The examiners are less experienced.

You're gonna have a whole bunch of new
ess 'cause they lost a lot of supervisors.

Maybe not in every region, but some
regions lost a lot of supervisors.

So you're gonna have less
experienced supervisors.

I don't know at the regional
level, the quality control.

I assume the same thing
has happened there.

You've got the most experienced
people there, have left, you've got

experienced executives left and.

Smart people, they're
going to figure it out.

And NCUA is going to figure it out.

But this chaos is gonna create some
turmoil here for a period of time.

And you're going to see, SES and
regions doing their own thing

to figure who the outliers are.

And if you get people that deviate
far from peer, they're going to

get highlighted and targeted.

So this whole chaos type thing
I just think it's gonna make

your examiners more challenging.

Examiners are gonna wanna write
findings and doors to move on.

They're going to say, I found it.

I didn't have time to fix it.

They're gonna address
symptoms, not root causes.

So it's gonna be challenging for everyone.

I've seen the thing on one of the
LinkedIn posts, a person, Hey, I

am glad for NCAA's budget cuts.

My exam time's gonna be shortened.

I have to deal with them less.

And it's this is one of those, be
careful what you wish for kind of things.

Treichel: Yeah.

Miller: Lot of things there go up, the
pendulum will swing back the other way.

NCOA did need to reduce staff,
but 27% and you can't control

where and how that's done.

And they probably re, they probably
don't have enough resources to do all

their legislatively mandated requirements
to protect that insurance plan.

They're gonna pick and choose and
triage and do the best they can.

And, there, there's gonna be
some casualties along the way.

Treichel: Yep.

It's just like a mass unit.

And Steve I've got some thoughts
about what Todd said, but Steve, I

any other thoughts of that you have
or any comments on what Todd said?

Farrar: Probably a little different,
but just from what we've observed

throughout the year to say what
I'd like to see a change in NCUA

is more cooperative production.

In the documents of resolution and
how the problems will be fixed,

not mandating from the examiner.

That would, to me, would be a
really big important step that

we would stop hearing, that, they
didn't even talk to us about it.

We just, we just got this door and we
just got it and, the meetings next week.

Treichel: Great point.

That's probably, if you had to, if you
had to say what was the biggest bad

trend in exams in our clients last year?

That was probably, it reminds
me of a Suzanne Vega song.

It's a one time thing.

It just happens a lot.

We've been seeing that quite a bit.

And then pivoting back to what Todd
said, I wrote down in my red pen

here, you have the CYA the, you have
growing pains, but what NCOA is having

is shrinking pains and something I've
mentioned on the podcast here on occasion.

Todd, you're talking about, the.

The they're risk averse.

They're less experienced that
they may put their thumb on CYA,

they may put their thumb on camel.

And my underlying fear about the
combination of the 27% and the combination

of the changes they made to their camel
requirements, they basically weren't able

to do their exams in compliance with their
requirements when they were fully staffed.

So they tweaked that,
then they go down 27%.

Then they say, you don't have to do
a 120 day contacting Camel fours.

You don't have to do a 180 day
contacting in camel threes.

And one argument would be, wow, they
don't have the, they don't have the

staff, so they're not gonna overreact.

And the, those on the border, if
you're, you might be a two, you might

be a three, will code you a two.

Because I don't have
the time to come back.

A CYA mindset of that is,
guys, you just told me I don't

even have to do a follow up.

I can make them a three and
not have to go in there.

That's perfect for me because I'm
saying there's some risks there, but

you're not gonna give me the time.

Which goes into the whole, the camel when
an exam, when you see an examiner who's

not comfortable talking about camel,
getting their cam, getting the camel

questioned by a credit union, what they'll
say is it's a it's just a resource tool

that we use for where we have to go.

And they've blown up the fact
that it's a re, that it's a, that

argument's gone because they're
saying you don't necessarily

have to go to the fours as often.

You don't necessarily
have to go to the threes.

And I get why they did that, but
it could have a perverse impact

of it's easy for me to code you a
three and then just not come back.

'cause before I had to come back
and I'd have to deal with it.

So I think I, I don't
think that's gonna be.

Often, but it will happen.

And I'm sure, also maybe we'll do a
podcast on that when we have a client

where it appears to have fit that
category and deviation from the peer.

They're gonna be doing more
offsite statistical analysis.

How many standard deviations are you away?

You've got the rate reports,
you've got the individual

regional reports, but, all right.

That's that's all I've got on this.

Any other last comments before we wrap
this episode of with flying colors, guys?

All right,

Miller: Steve, you didn't
use the word, you texted me.

You thought this whole
letter was a word salad.

Farrar: Well,

Miller: I was trying, that's
what you texted me last Friday.

I was the word salad.

Farrar: Yeah.

I did I did take the letter and I had AI
give me a summary and it took the, what is

it, a five page, five page letter and it
reduced it down to a page and a quarter.

Treichel: And it's definitely a different
type of letter than I've seen recently.

And it, one thought that popped
into my head is, and I know NCUA

or at least until recently, wasn't
allowed to let their people use ai.

It had a little bit of an
AI feel to it, the way it.

Condense things and summarize
things and that, and it might, and

I may be totally off track there.

It may be that Helpmann said,
I want this to be more simple.

And then what happens is he and I
goes, yeah, but we gotta say, we

gotta say a sentence about this.

So if I'm only, if I'm not allowed
to have more than four priorities or

however many we have, I'll just weave
it in here, and then I'll put six

attachments that have 800 pages to it.

So that really, it still
encompasses everything.

Said another way, it's a risk-based exam.

This kind of tells you what NCA
is thinking, but it doesn't mean

that you won't have to deal with
other things when NCA comes in.

All right, guys, as always,
thank you for your time.

Stay warm.

I'll do the same.

And listeners watchers as always,
I want to thank you for watching.

Thank you for listening.

Hope you'll listen again soon, or watch.

And this is Mark TriCal
signing off with flying colors.