WASHINGTON – NCUA said the $12 billion the Congressional Budget Office reported Monday as representing federal budget outlays related to the corporate credit union resolution are unrelated to the sale of $12 billion of NCUA Guaranteed Notes in 2011.
NCUA said the $12 billion in cash outlays scored by the CBO for the first quarter of the government’s fiscal year represents $10 billion in U.S. Treasury loans to the CLF, which NCUA repaid in December 2010 for the liquidation of U.S. Central FCU and WesCorp FCU (The $10 billion was originally loaned from the Treasury to the Central Liquidity Facility to the National CU Share Insurance Fund; then from the insurance fund to U.S. Central and WesCorp) and $2 billion of credit union-paid corporate assessments that NCUA deposited in its Treasury account in October.
The CBO says the amount of the corporate stabilization accounted for on budget and against the federal budget deficit on a cash basis and varies with the amount of funds being borrowed by NCUA, so that borrowings are accrued against the federal budget when they occur, and taken off budget when they are repaid. At one point NCUA had the $10 billion borrowed through the CLF and the $6 billion borrowed to capitalize the Temporary Corporate CU Stabilization Fund on budget. But NCUA has repaid the $10 billion CLF loan and paid down the $6 billion Treasury loan and had $3.5 billion of the loan outstanding at Nov. 30, which is on budget and part of the deficit.
