|
April 27, 2009 - The National Credit Union Administration (NCUA) Board approved a order to allow corporate credit unions to use their capital level as reported on November 30, 2008 to ensure services continue given expected losses from March 31, 2009 financials.
The NCUA reported in its April 24 corporate credit union weekly update that it expects some corporate credit unions to reflect losses that will be absorbed by capital when they post their March 31, 2009 financial statements. Since many corporates’ functions are tied to capital, the NCUA will allow corporate credit unions to use their November 30, 2008 capital level for determining regulatory compliance with capital-based requirements. “We believe this will allow corporate credit unions to continue to meet members’ needs while also ensuring corporates do not take additional undue risk,” stated NCUA Chairman Michael Fryzel in the April 24 update.
Normal operations continue at conserved federal corporate credit unions, WesCorp and US Central, reported the NCUA. The agency issued the following updates regarding the two corporates.
• The reviews of all private label mortgage backed securities by Clayton Fixed Income Services, Inc., at both U.S. Central and WesCorp are nearing completion. The results of these reviews, taken with NCUA’s own analysis, will assist in finalizing the level of Other-Than-Temporary-Impairment (OTTI) charges both corporate credit unions will record. This information will be the last step for both corporates in finalizing their 2008 audited financial statements. The March 31, 2009, financial statements are expected to be released in May.
• Liquidity remains stable. The support of member credit unions has been critical to maintaining adequate liquidity in the corporate credit union system. Seasonal outflows normally associated with April and May have begun. It is anticipated the Temporary Corporate Credit Union Share Guarantee Program will continue to instill member confidence in retaining deposits at their corporate credit unions.
• Member communication and outreach efforts continue. The following is a summary of communications efforts for each corporate credit union:
-U.S. Central - Periodic member teleconferences continue. A teleconference was held on April 22. An in-person member meeting is scheduled for April 29, 2009.
-WesCorp - Member teleconferences scheduled for Tuesday, Wednesday, and Thursday each week began on April 15 and will continue through May 15. Town hall meetings are scheduled to kick off on May 18, 2009.
To read more about NCUA’s actions to address the corporate credit union system, follow this link.
|
 |
|
|
NASCUS News Story Archive
Pressroom |
