NCUA Issues Results of Its
Member Service Assessment
Alexandria, Va., November 15, 2006 – The NCUA Board is releasing the results of the Member Service Assessment Pilot Program (MSAP).
MSAP was initiated by NCUA as a result of questions raised by Congress and the Government Accountability Office (GAO) regarding the income distribution of federal credit union (FCU) members, the types of services FCUs provide to their members, and the transparency of FCU executive compensation.
MSAP collected data on the membership profile of FCUs, the types of services provided to their memberships, and the total compensation of FCU executives. This process entailed the analysis of 14 million member account records from 448 randomly selected FCUs. The data provided statistically valid results for the entire FCU system, and for FCUs grouped by asset size (FCUs with less than $50 million in assets, and greater than or equal to $50 million in assets). MSAP also allows for descriptive analyses of the different FCU charters (occupational, associational, and community).
MSAP provides the most conclusive data to date available on the membership profiles of FCUs.
MSAP:
- Demonstrates that FCUs are serving those they are chartered to serve within their authorized field of membership (FOM), typically working individuals.
- Confirms that FCUs designated as low income, with underserved areas, or with a community base have more diverse membership profiles as compared to FCUs with more restrictive common bonds and FOM.
- Strengthens NCUA’s contention that changes in membership profiles do not occur immediately – they occur over time.
MSAP bolsters NCUA’s view that the FCU common bond limitation is the overriding factor that impacts membership demographics. Interpreting MSAP data is best understood and applied within the context of whom FCUs can legally serve. Who FCUs can serve is a critical factor that must be considered with other available data in assessing whether FCUs continue to serve their mission and purpose.
The MSAP data suggest that FCUs are also making progress in achieving congressional intent to serve low-income individuals and groups. This is most evident in those FCUs that have added underserved areas, are low-income designated, or those who serve a community. Congressional intent would be fully realized by a statutory change allowing all FCUs, not just those designated as multiple common bond, to add underserved areas.
MSAP review of FCU executive compensation indicates:
- In 2005, average chief executive officer (CEO) compensation (salary and benefits) was $77,490 and, median compensation was $58,860.
- Sixty-six percent of FCUs in the MSAP had total CEO compensation of $75,000 or less, while 80 percent had total CEO compensation of $100,000 or less.
MSAP report is available on NCUA’s web site www.ncua.gov.
The National Credit Union Administration charters and supervises federal credit unions. NCUA, with the backing of the full faith and credit of the U.S. government, operates and manages the National Credit Union Share Insurance Fund, insuring the accounts of over 85 million account holders in all federal credit unions and the majority of state-chartered credit unions. NCUA is funded by credit unions, not federal tax dollars.
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