ALEXANDRIA, Va.-NCUA said the initial offering of the CU System Investment Program, aimed at pumping new liquidity into the neediest corporate credit unions, will result in $4.9 billion being provided this week.
The initial funds will go to two corporates, U.S. Central FCU and WesCorp FCU, and must be used to replace external borrowings from sources like the Federal Home Loan Banks, the Federal Reserve or commercial paper investors. Under the program, the Central Liquidity Facility is lending funds to natural person credit unions at 1.25% with the condition that those funds are invested in so-called SIP notes with one of the corporates that pay 1.50%.
The program appears to be popular because NCUA originally planned to offer $500 million in the original offering. The funds were expected to be disbursed last week.
Separately, NCUA said its CU HARP - for Homeowners Affordability Relief Program - appears to be less popular than hoped for. NCUA, which hopes to provide as much as $4 billion in low-cost CLF loans so credit unions can refinance at-risk mortgages, received only $164 million in requests for the 1.25% loans.
