Committed to Community Development Presentation to National Federation of Community Development Credit Unions Baltimore, Maryland June 7, 2013 Debbie Matz, Board Chairman National Credit Union Administration

Committed to Community Development CDCUs Are Vitally Important! People of Modest Means Low-Income Communities The Credit Union Community Community Development Credit Unions serve: 1

Committed to Community Development Small Credit Unions Are Disappearing Number of Credit Unions by Asset Group 2

Committed to Community Development Mergers Are Rising Again 3 More than 91% of Mergers are Voluntary

Committed to Community Development Unprofitable Credit Unions More than 34% of Small CUs were Unprofitable in

Committed to Community Development 5

Small Credit Unions Struggling; Low-Income Credit Unions Surging Key Credit Union Ratios (as of Year-End 2012) Year-End 2009Year-End RD Qtr FICUs under $50 Million Low-Income Credit Unions All Credit Unions Return on Assets % % % Net Worth %10.62 %10.44 % Loan Growth % % % Loan Delinquencies 1.61 %1.31 %1.16 % Net Charge-offs 0.58 %0.66 %0.73 % Membership Growth % % % 6

Committed to Community Development Credit Union Exam Hours vs. Losses 7

Committed to Community Development New Office of National Examinations and Supervision Reallocating NCUA Resources Shifts in allocations based on assets and risks 8

Committed to Community Development Streamlining Small CU Exams Eligibility: FCUs with assets up to $50 Million Draft scope and procedures target main risks: Fraud, Record-keeping, Lending Core transaction testing for all small CUs – More in-depth, “triggered” levels of review, based on core results 2013: Transition Period 2014: Training and Implementation 2015: Full Adoption 9

Committed to Community Development NCUA’s Commitment to CDCUs Shorter Examinations Examiner Guidance Regulatory Relief Low-Income Designation Initiative Office of Small Credit Union Initiatives 10

Committed to Community Development 11

Committed to Community Development Building Your Future Internal Controls Strategic Planning Due Diligence 12

Committed to Community Development Contacting the Office of the Chairman Chairman:Debbie Matz Chief of Staff:Steve Bosack Senior Advisor:Buddy Gill Asst./Scheduler:Angela Sanders Phone: Feel free to contact our office with questions or comments. 13