In ‘Crisis Atmosphere,’ Call Report Delay Gives Credit Unions Flexibility

News from S&P Global Market Intelligence

Regulators granted credit unions and banks extra time to file their call reports amid the COVID-19 pandemic — a move that credit union trade groups say provided welcome flexibility for an industry working overtime to serve members and grant small business loans under the government's Paycheck Protection Program.

The industry's regulator, the National Credit Union Administration, extended the deadline for federally insured credit unions that file call reports on Form 5300 to May 26 from April 26. More than 90% of credit unions had filed call reports as of May 15, according to an S&P Global Market Intelligence analysis.

Even credit unions that did not use the extension appreciated the flexibility at a time when they are dealing with the pandemic while trying to serve members and issue loans, trade group representatives said.

Credit Union National Association Chief Economist Mike Schenk noted that roughly 40% of the industry operates with five or fewer full-time equivalent employees. "Staff is under a lot of pressure. Many of the branches are closed and people have been shuffled around to do various tasks that they're not used to doing," he said. That meant pulling people off of their normal duties, including employees normally helping to produce call reports.

One such task is issuing loans under the Paycheck Protection Program, which offers forgivable Small Business Administration loans as part of a sweeping coronavirus relief law. The government added $310 billion to the PPP after the initial authorization of $350 billion was allocated in about two weeks during April.

"It's just a crisis atmosphere in some respects and to take time away from trying to serve people and help them get through the mess to file the call report would have been a challenge for some," said Schenk, who is also chairman of Summit CU, a credit union with $3.88 billion in assets based in Wisconsin. "It was a real time-intensive, resource-intensive operation for us to do this. We had people basically working around the clock for three days."

The NCUA has provided additional time to complete regulatory reporting in the past due to disasters like hurricanes, a spokesperson for the regulator noted. The NCUA has also previously extended filing deadlines as a result of regulatory changes and system upgrades.

In normal times, credit unions filing late face penalties based on the size of the institutions, how late they file and whether they have missed the deadline previously. But filing late is relatively uncommon.