FFIEC proposal would modernize CAMELS ratings

The Federal Financial Institutions Examination Council (FFIEC) is inviting comments on proposed revisions to the CAMELS uniform financial institutions rating system. Regulators use the CAMELS rating system to evaluate the safety and soundness of financial institutions and identify those requiring heightened supervisory attention or other supervisory action.

America’s Credit Unions has called on NCUA to work with the FFIEC to modernize the CAMELS system to improve consistency and reduce subjectivity across examinations, and the proposal contains many recommendations in from the letter.

“America's Credit Unions appreciates the financial regulators pursuing reforms to the CAMELS rating system. We have long advocated for the FFIEC to modernize this system to improve consistency without jeopardizing safety and soundness of financial institutions," said America's Credit Unions Senior Vice President of Advocacy Greg Mesack. "We look forward to working with our credit union members to provide feedback on the FFIEC's proposed revisions."

The proposal updates the Management component’s evaluation factors to the most material aspects of risk management, one of the primary asks America’s Credit Unions made in November.

America’s Credit Unions will issue a Regulatory Comment alert, and comments are due August 17.