Navigating the NCUA’s 2025 Priorities: How Credit Unions Can Prepare

A new year brings fresh regulatory focus, and for credit unions, 2025 is shaping up to be a critical year for addressing evolving risks and strengthening operations, including the NUCA priorities. The National Credit Union Administration (NCUA) has released its 2025 Supervisory Priorities, targeting key areas that pose the highest risk to credit union members, the credit union system, and the National Credit Union Share Insurance Fund.

With rising loan delinquencies, shifting interest rates, growing cybersecurity threats, and evolving consumer protection regulations, credit unions need to take proactive steps to align with these priorities.

But you don’t have to tackle these priorities alone. Together, let’s break down NCUA’s 2025 focus areas so that you can move forward with actionable strategies to help your credit union prepare.

1. Credit Risk: Managing Loan Performance and Delinquencies

What’s Changing?
The NCUA is prioritizing credit risk in 2025 due to rising loan delinquencies and charge-offs, particularly in credit card portfolios and used vehicle loans. The current delinquency rates in these areas have surpassed levels seen during the 2008 financial crisis, raising red flags for regulators.

Examiners will take a close look at:

• Loan underwriting standards
• Collection programs
• Allowance for Credit Losses (ACL)
• Charge-off practices
• Third-party risk management, especially for outsourced lending and collections

How to Prepare:

• Strengthen Loan Underwriting: Tighten policies for high-risk portfolios like credit cards and used auto loans.
• Review Collection Programs: Make sure your collection strategies are both effective and fair, focusing on helping members while minimizing losses.
• Monitor Loan Modifications: Examiners will review workout strategies for members facing financial hardship. Track modifications carefully to show regulators that you’re supporting members responsibly.
• Evaluate Third-Party Partnerships: If you outsource lending, servicing, or collections, assess vendor compliance and oversight practices.

Comply-YES! Insight:
Our Loan Review Services help credit unions evaluate risk exposure and improve credit risk management. We can also assist with audits of your underwriting policies and third-party vendor relationships.

2. Balance Sheet Management: Protecting Earnings and Net Worth

What’s Changing?
Fluctuating interest rates continue to pressure credit unions’ net interest margins, leading to potential risks to earnings and net worth. The NCUA will focus on how well your credit union is managing market risk, liquidity, and long-term asset performance.

Examiners will focus on:

• Interest Rate Risk (IRR)
• Liquidity Risk
• Earnings Performance
• Net Worth and Capital Adequacy

How to Prepare:

• Reassess Interest Rate Risk Models: Make sure your IRR models reflect current market conditions and include prepayment risks.
• Strengthen Liquidity Planning: Identify alternative funding sources and run stress tests to prepare for market fluctuations.
• Monitor Net Worth and Capital: Evaluate your current capital position and develop contingency plans for unexpected market shifts.

Comply-YES! Insight:
Our Risk Management Services provide tailored solutions for interest rate risk, liquidity planning, and capital adequacy assessments, helping your credit union navigate financial volatility.

3. Cybersecurity: Strengthening Digital Defenses

What’s Changing?
Cyberattacks against financial institutions are increasing in both frequency and sophistication. The NCUA continues to make cybersecurity a top supervisory priority in 2025, with examiners focusing on your information security programs, incident response plans, and third-party vendor security.

Key areas of focus include:

• Information Security Programs
• Incident Response Plans
• Third-Party Vendor Risk
• Cyber Incident Reporting (72-hour notification requirement)

How to Prepare:

• Conduct Regular Security Audits: Assess your network security, data encryption, and access controls.
• Update Incident Response Plans: Confirm they include steps for detection, containment, and reporting, in line with NCUA’s 72-hour reporting rule.
• Evaluate Vendor Security: Third-party vendors are often the weakest link. Conduct due diligence and request SOC reports from vendors.
• Use the NCUA’s Automated Cybersecurity Evaluation Toolbox (ACET): This tool helps assess your credit union’s cybersecurity maturity.

Comply-YES! Insight:
Our Information Security and Technology Compliance Services offer comprehensive cybersecurity assessments and audits that can help you strengthen your defenses and prepare for regulatory scrutiny.

4. Consumer Financial Protection: Putting Members First

What’s Changing?
Consumer protection laws remain a core focus of NCUA examinations. In 2025, examiners will continue to assess compliance with major regulations that impact members directly, including:

• Overdraft Programs: Examiners will scrutinize overdraft fees, policies, and member disclosures.
• Fair Lending: Special attention will be paid to residential real estate valuations and discriminatory lending risks.
• Home Mortgage Disclosure Act (HMDA): For credit unions above the reporting threshold, data collection and reporting will be evaluated.
• Military Lending Act (MLA): Compliance with MLA requirements—including fee limits and loan terms—will be closely reviewed.
• Electronic Fund Transfer Act (Regulation E): Examiners will assess policies around payment disputes, error resolution, and electronic transfers.

How to Prepare:

• Review Disclosures: Make sure overdraft, lending, and transfer policies are transparent and compliant.
• Analyze Lending Data: Check for disparities that could raise fair lending concerns.
• Update Consumer Compliance Training: Keep your team informed about changes in consumer protection laws.
• Conduct Internal Audits: Focus on areas with a history of member complaints or regulatory findings.

Comply-YES! Insight:
We offer Consumer Compliance Audits that help credit unions evaluate their policies and practices, reduce regulatory risk, and promote member trust. We also offer a number of trainings to keep your staff up-to-date on compliance and regulatory changes.

5. Preparing for Regulatory Examinations

What’s Changing?
In 2025, the NCUA is updating its exam flexibility initiative. Some credit unions may qualify for longer exam cycles based on asset size, CAMELS ratings, and CEO continuity. However, higher-risk credit unions may still face more frequent reviews.

Key updates include:

• Extended exam cycles (up to 16 months) for qualifying credit unions over $1 billion in assets.
• Adjustments to the Small Credit Union Exam Program for credit unions with assets under $50 million.

How to Prepare:

• Stay Exam-Ready: Maintain accurate, up-to-date documentation and prepare staff for potential examiner inquiries.
• Conduct Mock Examinations: Simulate NCUA reviews to identify potential weaknesses before examiners do.
• Review Past Examination Findings: Address lingering issues and be ready to discuss improvements during your next exam.

Comply-YES! Insight:
Our team offers Regulatory Exam Preparation services, helping you stay organized and confident heading into your next NCUA exam.

Navigating the NCUA’s 2025 priorities doesn’t have to be overwhelming. With a proactive strategy and the right support, your credit union can confidently meet regulatory expectations while continuing to focus on serving members.

At Comply-YES!, we specialize in helping credit unions like yours tackle compliance challenges head-on. From cybersecurity audits to consumer compliance reviews, our team offers the tools and expertise you need to stay ahead.

Ready to get started? Let’s talk about how we can help your credit union navigate the year ahead.

Contact Us Today and turn compliance into a competitive advantage.