On January 14, the NCUA issued its annual letter to federally-insured credit unions outlining supervisory priorities and setting the agenda for examinations and oversight in 2026. The letter identified deteriorating asset quality, elevated loan losses, and increased delinquency rates as critical risks, and noted that loan performance had reached its lowest point in more than a decade. The NCUA said examiners would focus on credit risk management, including loan underwriting, loss mitigation, allowance for credit loss reserves, and oversight of third-party relationships. The agency also directed attention to liquidity and interest rate risk, urging credit unions to adopt diversified funding strategies and sound modeling practices to withstand market volatility.

The letter further emphasized operational risk management with a particular focus on payment systems and fraud prevention. The NCUA stated it would continue to review governance, vendor management, and cybersecurity frameworks to safeguard member data and strengthen defenses against fraud and cyber threats. According to the letter, compliance with the BSA/AML regime remains a priority, with the agency expecting credit unions to tailor their programs to their risk profiles and stay updated on regulatory changes. The NCUA explained these supervisory priorities comport with the agency’s “No Regulation-by-Enforcement” policy statement and welcomed public feedback.