She cited the same reason the agency had streamlined the exam for small credit unions and reflected on some of the impacts that change of policy has had. During the question-and-answer period after her address at the Sheraton Inner Harbor Hotel, Matz stressed that the agency wanted small credit unions to have good, strong exams but not to rely on examiners too much.

She recounted a meeting with examiners who had objected to spending less time in smaller credit unions. One examiner at the meeting told her that he had spent 80 hours in one credit union and that they needed his attention. When Matz asked how large the credit union was, the examiner had replied it had been a $500,000 credit union.

“As much as we want our credit unions to get guidance from examiners, the things this examiner was doing in that credit union was really more appropriately done by the Office of Small Credit Unions,” she said.

Matz lamented in particular the loss of small credit unions and urged them to keep their capital well above 7% and said they should really aim for keeping 10% to serve as a buffer against future unexpected difficulty. She told the assembled executives that only 20% of small credit unions that fall below 7% net worth succeed in rebuilding it.

She also urged small credit unions to learn about and implement better internal controls, reporting that there had been nine credit unions liquidated this year because of fraud losses.

“It is so exasperating for me to hear that a manager or key employee who has been with the credit union for years is in prison or has been arrested for stealing from the credit union,” she said.