LYNCHBURG, Va. – Even as U.S. Central FCU is reporting an additional $500 million depletion in their capital, several corporate credit unions are deferring the trickle-down depletion of their own capital until the release the long-awaited 2008 financials for U.S. Central, which are expected to show additional losses.
The U.S. Central move, announced Friday, will erase $500 million of capital owned by its 27 corporate members, much of which the corporates will have to pass on to their own members.
"Unfortunately, U.S. Central losses continue to be a moving target," Jim Hansen, president of Virginia Corporate FCU, told his members, as he was reporting a $16 million depletion of his own members capital trickling down from U.S. Central.
But VACorp, like several other corporates, will wait until U.S. Central releases long-delayed 2008 report and NCUA confirms the accounting, before recording any write-downs of its own capital, Hansen told his members.
Georgia Central Corporate CU also told its members it expects to have to deplete their capital, by about $30 million, as a result of the U.S. Central actions, but will delay depleting its capital until the U.S. Central report. "We continue to defer depletion of U.S. Central capital on Georgia Centra’s books, as well as the possible depletion of our members’ capital, until after the release of U.S. Central’s audited financials and consultation with our auditor," Greg Moore, president of the $1.8 billion corporate, told his members.
Several other corporates have indicated in recent days they will start passing on the U.S. Central charges by depleting their members’ capital, including Members United Corporate FCU and Constitution Corporate FCU.
