Share insurance fund, voluntary separation program covered in NCUA meeting

The NCUA held its first board meeting with NCUA Chairman Kyle Hauptman serving as the sole board member since the dismissal of board members Todd Harper and Tanya Otsuka. Thursday’s meeting  featured a quarterly update on the National Credit Union Share Insurance Fund and the agency’s voluntary separation program.

“No matter what the board looks like, the NCUA will continue to fulfill its core mission as well as to continuously seek ways to improve our effectiveness,” said Hauptman. “The NCUA leadership team and myself are equipped with the required authorities to continue protecting the system of cooperative credit and its member-owners through effective chartering, supervision, regulation, and insurance.”

The briefing on the agency’s voluntary separation program included a timeline from the Feb. 11 Executive Order on workforce optimization through the NCUA board approving a voluntary separation program on March 21. 

According to staff, the goal is a 20% reduction in headcount by the end of 2025. Employees who participate in the separation program can leave at any time before Dec. 31. The first round of the separation program ran from March 31 to May 5, and it is unlikely there will be a second round.

As of May 21, 257 staff had enrolled, and the agency estimates an eventual 21.5% reduction from the January 2025 headcount.

Staff estimate $75 million in 2026 payroll and contract savings, with the majority used to reduce the budget amount.

America’s Credit Unions Chief Advocacy Officer Carrie Hunt said the savings “will ensure credit unions can use their resources to remain focused on serving their members,” and added America’s Credit Unions “will continue to work with the NCUA through its changes, to ensure a vibrant industry.”

Proposed changes to the future of the agency will be included in the NCUA’s draft 2026-2027 budget.

The share insurance fund ended the first quarter with:

• $79.8 million in Net Income, a $1.2 million increase from Q4 2024;
• $23 billion in Total Assets, a $0.7 billion increase from Q4 2024; and
• $242 million in Total Reserves, a $5 million increase from Q4 2024.

The fund’s equity ratio was 1.30% at the end of 2024, and agency staff project the ratio to be 1.26% at the end of the second quarter of 2025. Agency staff also noted there were no credit union failures incurring losses to the fund during the first quarter of 2025.

Staff also provided an update on changes to the examination schedule, which are intended to allow the regions to allocate exam resources where most needed to assure safety and soundness.

As detailed in an NCUA chart, the changes provide an extended examination cycle for certain well run, well capitalized federal credit unions, including those between $1 billion and $15 billion in assets that are now eligible for a 12- to- 18-month cycle, or even up to 20 months for those with a net worth ratio greater than 10%. Further, well-run, well-capitalized federal credit unions with less than $1 billion in assets are now eligible for a 14 to 24-month cycle.

The remaining 2025 meetings are listed as “tentative” on the agency’s website.