SAN DIMAS, Calif. – NCUA told members of WesCorp FCU Friday it plans to begin redeeming all of the corporate’s $3 billion in fixed-rate CDs Oct. 3, even as it works to maintain services at the remnants of the one-time $34 billion corporate.
As part of that effort, the federal regulator said it is holding a meeting Oct. 3 with potential bidders for the WesCorp assets.
WesCorp, which has been run by NCUA under conservatorship since March 2009, failed in its efforts to raise capital for a revival and its days appear numbered.
In its notice to members, signed by Scott Hunt, director of NCUA’s Office of Corporate CUs, NCUA said the largest cost associated with operating WesCorp are the dividends payable on the CDs. The early redemption of the CDs is projected to save NCUA $31.6 million.
NCUA also said it repaid the $82 million pledged by WesCorp members as part of the ill-fated capital raising on Sept. 15.
WesCorp is one of five failed corporates–along with U.S. Central, Members United Corporate FCU, Southwest Corporate FCU and Constitution Corporate FCU. Southwest Corporate is being revived after a merger with Georgia Corporate FCU as Catalyst Corporate FCU, and the NCUA Board is expected to vote this week on a new charter for Members United, which is being reorganized as Alloya Corporate FCU.
