The Endangered Small Credit Union Defense

Endangered Small Credit Union Defense (ESCUD) Small Credit Unions for Regulatory Relief www.EndangeredSmallCUDefense.org July 16, 2026 Federal Financial Institutions Examination Council Via Federal eRulemaking Portal Re: Proposed Revisions to the Uniform Financial Institutions Rating System (UFIRS/CAMELS) Dear FFIEC Members: On behalf of the Endangered Small Credit Union Defense (ESCUD), a nonprofit advocacy organization representing small credit unions under $500 million in assets, we strongly support the proposed revisions to the CAMELS rating system. Our member credit unions operate with lean staffs and simple balance sheets. They are disproportionately burdened by examination processes that emphasize documentation, policy details, and subjective Management ratings over actual material financial risk. ESCUD surveys repeatedly identify examination exhaustion and over-compliance pressure as among the greatest obstacles to the survival of small credit unions. The proposal’s focus on material financial risks, the removal of special consideration for the Management component in composite ratings, the narrowing of Management evaluation factors, and the clearer materiality threshold for adverse ratings would provide meaningful, practical relief. These changes would allow healthy small credit unions to spend less time preparing for and responding to non-material findings and more time serving their members and communities. We urge the FFIEC to finalize the revisions as proposed (or strengthen them further in the direction of material risk focus). This reform is consistent with risk-based supervision and will help preserve the unique role of small, community-focused credit unions without compromising safety and soundness. Thank you for the opportunity to comment. We stand ready to provide additional perspective from the small-credit-union viewpoint. Sincerely, Doug Wadsworth President, Endangered Small Credit Union Defense President Tri-Cities Community Federal Credit Union Doug@Tri-CU.com | 509-735-8331 ESCUD has also been "officially" endorsed by the following small credit unions across the nation. The officially endorsing small credit unions represents over 200,000 members and $1.5 Billion in assets. Granco Federal Credit Union (Ephrata, WA) Mint Valley Federal Credit Union (Longview, WA) Nordstrom Federal Credit Union (Everett, WA) *Tri-CU Federal Credit Union (Kennewick, WA) Connection Credit Union (Silverdale, WA) Spokane Media Federal Credit Union (Spokane, WA) Spokane City Credit Union (Spokane, WA) *evergreenDIRECT Credit Union (Tumwater, WA) Prime Source Credit Union (Spokane, WA) IBEW 76 Federal Credit Union (Tacoma, WA) Community Healthcare FCU (Everett, WA) Waterfront Credit Union (Seattle, WA) United Trades Federal Credit Union (Tulatin, OR) Benton County Schools Credit Union (Corvallis, OR) The Alaska District Employees Federal Credit Union (Anchorage, AK) *Alaska District Engineers FCU (JBER, AK) *POLAM Federal Credit Union (Las Angeles, CA) Vida Federal Credit Union (Ontario, CA) California Community Credit Union (Sacramento, CA) Desert Valleys Federal Credit Union (Ridgecrest, CA) SEG Federal Credit Union (Laurel, MT) Marshfield Medical Center Credit Union (Marshfield, WI) American Southwest Credit Union (Sierra Vista, AZ) Campus Credit Union (Wichita, KA) Chattahoochee Federal Credit Union (Valley, AL) Ascension Credit Union (Gonzales, LA) New Orleans Firemen's FCU (New Orleans, LA) Milestones Federal Credit Union #5144 (Lewiston, ME) IBEW 26 Federal Credit Union (Lanham, MD) Revity Federal Credit Union (Greensboro, NC) Acclaim Federal Credit Union (Greensboro, NC) Bessemer System Federal Credit Union (Greenville, PA) *Great Meadow Federal Credit Union (Granville, NY) Good Neighbors Federal Credit Union (Depew, NY) Chelsea Employees Federal Credit Union (Chelsea, MA) Cranberry Federal Credit Union (West Wareham, MA) *Beverly Credit Union (Beverly, MA)