Liquidation Of Corporate CUs Advances

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WALL STREET – NCUA, which is in the process of liquidating U.S. Central FCU and WesCorp FCU, is expected to launch a second sale of legacy assets bonds, known as NCUA Guaranteed Notes, in the coming days.

The second offering, expected as soon as the end of this week, will include assets of WesCorp, the one-time $34 billion corporate that was taken over along with U.S. Central by NCUA in March 2009, according to sources familiar with the deal.

NCUA completed the first sale of corporate-backed bonds last week, a deal worth $3.8 billion, which consisted of cash flows on assets taken from U.S. Central, which was liquidated Oct. 1. The sale was managed by Barclays Capital.

As many as 10 more offerings totaling as much as $35 billion are expected to be launched over the next five months, officials as Barclays said last week.

The initial U.S. Central and WesCorp offerings, which are federally guaranteed, will test investor appetite for subsequent bond offerings that will liquidate the recent corporate failures of Members United Corporate FCU, Southwest Corporate FCU and Constitution Corporate FCU, the Barclays sources said.

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