LENEXA, Kan.-U.S. Central FCU reported the spreading credit crisis tainted more of its asset backed securities in October, pushing unrealized losses on its vast investment portfolio up by another $1 billion, to a total of $7.3 billion.
The central bank for credit unions, which is struggling to cope with huge unrealized losses on its mortgage backed securities, said October was marked by large unrealized losses on other asset-backed securities for credit card receivables, auto loans and student loans, which lost about $600 million in value in the month.
The corporate's mortgage-backed portfolio continued to decline in value, by another $200 million for the month.
David Dickens, senior vice president for asset/liability management at U.S. Central, said the corporates' corporate continues to hold the securities in hopes they will regain their value, while the huge portfolio of bonds continues to pay interest and principal.
Any plans to sell the securities into the market would require U.S. Central to realize some of the losses, he noted.
U.S. Central reported $1.4 million in losses on the securities in October on securities classified as trading, jumbo mortgage loans held for sale and on hedging instruments.
Still, U.S. Central was able to record net income of $30 million for the month, bringing year-to-date net income to $75.9 million.
Total assets at the end of October were $37.4 billion, down from $46.3 billion a year ago.
