Proposed CAMELS Changes Would Reduce Weight of Management Ratings
By CU Today Staff —
WASHINGTON--Proposed updates to the Federal Financial Institutions Examination Council’s (FFIEC) CAMELS rating system are a step toward a more consistent and transparent exam framework, as shared in America’s Credit Unions’ letter filed with the FFIEC Monday.
The proposal would reduce the special weight currently given to the “Management” component, focus the Management rating more clearly on material financial risk, limit the effect of specialty review findings, and remove references to reputation risk, all supported by America’s Credit Unions.
The changes would improve the CAMELS framework for all covered financial institutions, but the letter notes “they are especially important for credit unions, where examination ratings can affect major operational and strategic decisions.”
In the letter, America’s Credit Unions also:
Originally reported by CU Today.