WALLINGFORD, Conn. – Constitution Corporate FCU reported yesterday that it took a $6.3 million impairment charge on its investment portfolio last month, pushing the $1.6 billion corporate into the red for the first three quarters of the year by $2.9 million.
That compares to net income of $2.3 million for the first three quarters last year.
Constitution Corporate also reported the deteriorating conditions in the mortgage markets pushed unrealized losses on its investment portfolio to $228.7 million at Sept. 30, from $195 million the month before.
The growing losses prompted Fitch Ratings last month to put the Connecticut corporate on its Rating Watch Negative, because of the concern that the likelihood of Constitution realizing meaningful losses in its investment book has increased. "Constitution's exposure to the troubled mortgage market, including home equity, subprime and Alt-A product, has contributed to a large unrealized loss position in relation to capital," said Fitch.
