RICHARDSON, Texas – Hard times continued for Texans CU in 2009, especially in the $1.7 billion credit unions member business loan portfolio, helping push losses for the one-time Texas Instruments credit union to $51.2 million.
"The most significant factor behind Texans’ loss in 2009 was the continuing impact of the economic recession on our commercial loan portfolio," said Mike Sauer, president of Texans, in an e-mail response to The Credit Union Journal. "We have a group of very experienced commercial real estate workout specialists to manage our portfolio. They have been successful in substantially reducing the balance of outstanding loans in the last two years and will continue their efforts to minimize the impact of the economic environment.”
The year started out with turmoil, with the departure of CEO David Addison after a $44.4 million loss for 2008. Problems at several of Texans’ CUSOs prompted a Chapter 11 bankruptcy by the Texans CUSO Insurance Group amid a $6 million judgment against the CUSO by its former president. That judgment, now $7 million with legal expenses, was upheld recently by the federal bankruptcy.
Sauer, a long-time director at Texans who took over as CEO last April, said the working out of commercial loans will be a main focus of the coming year.
"Our main objectives for 2010 are to continue to manage and maximize the value of our commercial loans, to significantly decrease operating expenses, and to return to a more traditional credit union operating model focused on member service and consumer lending – a model that proved very successful for Texans in the past," he wrote in his e-mail.
