Questions
Think Like Senior Credit Union Management
Work through your own credit union's profile and compare it to the one you're paired with. In each area, start with the direct measurement questions to read the numbers, then move to the discussion questions to get at causes, risks and strategy. Approach it as management deciding where to protect strengths, fix weaknesses and put resources.
▶Reading the FPR Before you start
The FPR is not a UBPR with different labels. Four differences change how the numbers should be read, and every one of them will trip up a banker who skips this section.
  • Every earnings ratio is struck over average assets, not average earning assets. Margin, cost of funds, fee income and overhead all share that denominator. Nothing here ties to a UBPR margin, and the two should not be compared across a table.
  • Growth is year-to-date over prior year-end, annualized — not a trailing twelve months. The March figure multiplies one quarter by four, so early-year growth rates are volatile by construction.
  • The peer group is an asset-size band NCUA assigns, not a set chosen for comparability. Two credit unions in different bands are being measured against entirely different populations.
  • Peer averages and percentiles lag one quarter. The current column has none, and the app names the quarter each comparison came from rather than implying it is current.
Direct measurement
  • Which peer group is each of your two credit unions in? Are you comparing them to the same population or to different ones?
  • What quarter does the peer comparison come from on the page you're looking at?
▶Profile Size, structure, mix
Before judging performance, understand the shape of the balance sheet. Size, asset composition, loan mix, share mix and membership set both the opportunities and the risks that follow.
Direct measurement
  • How does your total asset size compare to the credit unions in the room?
  • Is your credit union close in size to the one you're paired with, or is one of you an order of magnitude larger?
  • What share of assets are loans, and what share is investments?
  • Which loan category is largest — used vehicle, new vehicle, first mortgage, something else? Is it the same one for the credit union you're paired with?
  • On the funding page, what share of shares is non-maturity versus certificates and IRA?
  • How many members do you have, and what share of your potential field of membership is that?
  • What is your average share balance and average loan balance? How do they compare?
Further discussion
  • Does your size give you scale advantages, or does it limit what you can offer?
  • How does the split between loans and investments shape your earnings potential and your liquidity?
  • If your loan mix is concentrated in vehicles, what happens to it when auto lending slows or captive finance gets aggressive on rate?
  • A field of membership you've penetrated 8% of and one you've penetrated 40% of imply very different growth stories. Which are you, and what does that mean for the next five years?
  • Your average loan balance differs from your paired credit union's. Is that product mix, member income, or underwriting?
  • Are these characteristics aligned with your long-term strategy, or are they a legacy of past decisions?
▶Return Earnings power
Return measures how well the credit union converts its balance sheet into earnings. A credit union is not maximizing return — it is earning enough to build net worth and fund the member value proposition. The question is whether the level is sustainable and whether the mix behind it makes sense.
Direct measurement
  • What is your ROAA, and how does it compare to the peer average?
  • Is your net interest margin wider or narrower than peers? By how much?
  • How does your yield on loans compare to peers? Your yield on investments?
  • Is your cost of funds meaningfully higher or lower than the credit union you're paired with?
  • On the margin components page, which of the three lines moved most over the five quarters?
  • How much fee and other operating income do you generate relative to peers?
  • Is your non-interest expense above or below peers? What about your efficiency ratio — operating expense over gross income?
  • Is provision expense above, below or near peers? Is it a material drag?
Further discussion
  • If your margin is strong, is that loan pricing, asset mix, or cheap funding?
  • If your cost of funds is low, is it genuinely core shares or simply slower repricing that will catch up?
  • Fee income at a credit union carries a member-relations question a bank's does not. If yours is high, where does it come from, and is it defensible to your board and your members?
  • How much of your overhead is structural — branches, staff, systems — and how much is discretionary?
  • If your efficiency ratio is worse than peers but your ROAA is fine, what is carrying you? Is that durable?
  • If provision is low, is credit genuinely clean, or are you under-reserving?
  • How would these earnings hold up in a different rate environment?
All of these denominators are average assets. Yield on loans and yield on investments are the exceptions — each is struck against its own average balance. The three lines on the margin components page are therefore not additive; don't try to build a margin from them.
▶Risk: Asset Quality Credit
Asset quality reflects the health of the loan portfolio. Delinquency and charge-offs show current stress and hint at future losses. The FPR's headline delinquency measure is 60 days and over; the 5300 collects a 30–59 day bucket separately, and it is not in this ratio.
Direct measurement
  • How does your delinquency ratio compare to the peer average? What percentile?
  • How does delinquency to net worth compare? Does it tell the same story as delinquency to loans, or a different one?
  • How does your net charge-off ratio compare to peers?
  • On the combined delinquency-plus-charge-offs page, are you and your paired credit union closer together or further apart than on either measure alone?
  • How much do you carry in foreclosed and repossessed assets relative to total assets?
  • Have any of these measures moved materially across the five quarters?
Further discussion
  • If charge-offs are elevated, is that one segment or the whole book?
  • Given your loan mix, where would you expect losses to show up first — and does the data agree?
  • Delinquency to net worth is the measure that says whether credit can hurt you. At your level, how large a loss event would it take to matter?
  • Has your loan mix shifted recently in ways that could show up in credit later?
  • If your credit looks better than peers, is that underwriting, member base, or market conditions?
  • Are the two ratios moving in the same direction? Rising delinquency with falling charge-offs, or the reverse, usually means something specific is happening.
▶Risk: Liquidity Funding stability
Liquidity comes from two places: assets you can turn into cash, and funding that stays put. The FPR gives four views — loans to assets, cash and short-term investments to assets, loans to shares, and total funding against earning assets. There is no primary-liquidity measure net of pledging, so what you see is the gross picture.
Direct measurement
  • Is your loans-to-assets ratio above or below peers, and has it moved over the five quarters?
  • What share of assets is cash and short-term investments? How does that compare to peers and to your paired credit union?
  • Is your loans-to-shares ratio above 100%, below, or about the same as peers?
  • Is funding to earning assets above or below 100%? What does the difference represent?
  • Between the two credit unions on screen, which is carrying more liquid assets?
Further discussion
  • Is a thin cash position a deliberate decision to deploy into loans for earnings, or a funding constraint?
  • If shares fell 5% next quarter, where does the replacement funding come from, and what does it cost?
  • If your loans-to-shares ratio is low, is that under-utilization or a deliberate buffer? If high, does your plan address stressed funding markets?
  • The cash and short-term investments measure counts anything under a year. How much of yours would actually be sellable in a week without a loss?
  • Between you and your paired credit union, who has more room to absorb an outflow — and is the difference market or strategy?
The under-one-year investment split may reflect a repricing interval rather than a final maturity, per the 5300 instructions. A floating-rate bond maturing in eight years can land in the under-one-year bucket.
▶Risk: Interest Rate Risk Margin and value exposure
Interest rate risk shows up in the timing mismatch between what your assets earn and what your funding costs. The FPR gives an asset-side timing picture — net long-term assets, the investment maturity ladder, and fixed-rate real estate — plus, for credit unions under $500 million, NCUA's standardized NEV shock. It cannot give you a funding-side timing picture: non-maturity shares are reported entirely in the under-one-year bucket, exactly the way the UBPR treats non-maturity deposits. Only the certificate and IRA ladder carries usable timing.
Direct measurement
  • What share of assets are net long-term assets? Above or below peers?
  • Where does your investment ladder sit — concentrated under a year, or spread out past five and ten?
  • How does that ladder compare to the credit union you're paired with?
  • What share of loans is fixed-rate real estate? What share of assets?
  • On the share structure page, what share of funding is non-maturity? Of the certificates, how much matures inside a year?
  • If both credit unions are under $500 million: what is each post-shock NEV ratio, and each sensitivity? How do they compare to peers?
  • Slide back through the earlier quarters — has your asset structure shifted, or held steady?
Further discussion
  • Your investment ladder and your fixed-rate real estate are two different long positions. Which one is doing more to lengthen your balance sheet?
  • If your assets are concentrated short, what does a rate cut do to your margin? If concentrated long, what did the last rise already do to your economic value?
  • Non-maturity shares are the largest single item on most of these balance sheets and the FPR tells you nothing about their behavior. What would you need to know about them to convert this asset-side picture into an actual risk position?
  • The ENT applies a 1% base premium and a 4% shock premium to non-maturity shares for every credit union alike. Would your own share behavior justify a larger premium or a smaller one, and what would that do to your post-shock ratio?
  • Is your current asset timing an intentional position, or the residue of what members wanted to borrow?
  • Over the past year, did your margin move the way your structure suggested it should? If not, what does that tell you the data isn't showing?
  • Between you and your paired credit union, who is better positioned for the rate path you actually expect over the next 12–24 months?
The Estimated NEV Tool is NCUA's standardized calculation applied to Call Report balances, not the credit union's own model, and NCUA runs it only below $500 million in assets. Above that threshold the FPR prints N/A and so does this app. A standardized shock is a screening device, not a measurement of your position.
▶Capital Strength, capacity
Net worth absorbs unexpected losses, satisfies PCA, and creates room to grow. A credit union has one way to build it — retained earnings — which makes the relationship between the net worth ratio and ROAA far tighter than the equivalent relationship at a bank.
Direct measurement
  • What is your net worth ratio, and where does it sit against the peer average and the PCA thresholds?
  • How does net worth plus the allowance compare? Does adding the allowance change the picture much?
  • What is your GAAP equity ratio, and how far is it from your net worth ratio?
  • What is your solvency evaluation? Is it above 100?
  • What are classified assets as a share of net worth?
  • How far apart are you and your paired credit union on the net worth ratio?
Further discussion
  • The gap between your net worth ratio and your GAAP equity ratio is largely accumulated other comprehensive income. If that gap is wide, what is sitting in your available-for-sale portfolio, and would it matter if you had to sell?
  • Your only source of net worth is retained earnings. At your current ROAA, how fast can you grow assets before the net worth ratio starts falling?
  • If you grew loans 10% next year, what would that do to the ratio?
  • If you're holding more net worth than peers, is it for safety, growth readiness, or the absence of anywhere better to put it?
  • If you're holding less, is that fast growth, recent losses, or a deliberate choice to return value to members through rates and fees?
  • Could your net worth carry credit losses and margin compression at the same time?
▶Growth Pace, balance
Growth drives earnings and member reach, but it consumes net worth and liquidity and can strain credit. Sustainable growth keeps loans and shares roughly in step, and keeps asset growth inside what retained earnings can support.
Direct measurement
  • Is total asset growth positive or negative? How does it compare to peers?
  • Is loan growth faster, slower, or about the same as share growth?
  • How does net worth growth compare to asset growth? Which is faster?
  • Is membership growing, and how does that compare to share growth?
  • How does that pattern compare to the credit union you're paired with?
  • Look at the March quarter against the December quarter on any of these. Does the jump look like a real change in pace, or an artifact of the annualization?
Further discussion
  • If net worth growth is slower than asset growth, your net worth ratio is falling. How long can that run before it becomes a problem?
  • If loans have outrun shares, what funded the difference — investments running off, or borrowings?
  • If shares have outrun loans, where is the money going, and what is it earning?
  • If membership is growing faster than shares, are the new members bringing balances, or just accounts?
  • If membership is flat but shares are growing, what happens when your existing members age out?
  • Are you growing faster or slower than your strategic plan called for?
  • What are the tradeoffs if you accelerate or slow growth next year?
Every growth rate here is year-to-date over prior year-end, annualized. In the March column that means one quarter multiplied by four. Compare the December figures across credit unions if you want a clean annual rate.