MONTEREY, Calif. — Just four days before NCUA took over WesCorp and U.S. Central, NCUA Vice Chair Rodney Hood appeared before a California audience and was asked about the corporates' health. Here's how he responded to two questions:
Q: Have the corporates been reorganized in terms of practices, and second, we don't like surprises-are there any other corporates that we all are going to have to bail out?
Hood: Corporates were not really investing in exotic products, and I want you to know that, in and of themselves, these were not bad products. I know folks are calling for ouster of these corporate leaders, but these were all AAA-rated at the time they were bought. Yes, they've gone south, but a lot of the models that evaluated those securities only looked at positive trends and rising housing values. We are looking at corporate governance. We're looking at greater core competencies for the folks who are on the boards.
Q: Can we take it there are no other corporates that are on the brink?
Hood: We continue to evaluate all corporates. I remain confident that we as a board will use the tools at our disposal to help any corporate needing assistance. I know that sounds like Washington speak, but there is confidentiality involved here.
