WASHINGTON – CUNA said yesterday the crashing stock markets slammed its investment portfolio last year to push the trade association deeper into the red, to the tune of $8 million.
The announcement came at in inauspicious time on the first day of the annual Government Affairs Conference, where CUNA is celebrating its 75 year anniversary and the 100th year of credit unions. This year’s conference is already shaded by the gloom over NCUA’s $5 billion corporate credit union bailout, which credit unions are being required to pay for.
Last year’s losses are up from losses of $5.2 million for 2007. The 2007 loss little notice because CUNA announced preliminary net income of $500,000 at last year’s GAC, which was ultimately erased after CUNA marked down the value of its investments and deferred benefits plan by $7.2 million.
Michael Mercer, the president of Georgia CU Affiliates and the treasurer of the CUNA Board, said during CUNA’s annual meeting yesterday this year’s losses were all attributed to losses of $4 million on CUNA’s investments and an identical amount on its deferred benefits portfolio. "The portfolio declined when the equity markets declined, especially in the fall," said Mercer.
The losses of the last two years have erased almost a third of CUNA’s worth, with assets at $16.3 million at the end of 2008.
Otherwise, Mercer said CUNA’s operating budget continued to be in the black, last year by $900,00. That figure was only possible, however, by enacting a freeze on senior executives’ salaries and cutting staff by six employees.
For 2008 CUNA reported $58 million in revenues and $57.1 million in expenses, with operating income of $900,000. But a non-operating loss, including the loss on investments and a $900,000 loss booked for CUNA’s Stratcom project promoting the credit union "little guy," created the $8 million loss.
Mercer said the figures released yesterday are still unaudited. The audited financial are expected to be released in April.
