LENEXA, Kan. – NCUA said this evening it still believes U.S. Central FCU is a "viable" credit union, even after it issued audited financials for 2008 showing a quadrupling of previously reported losses to almost $5 billion.
The report says since January, when U.S. Central reported a $1.2 billion loss for 2008, more securities were determined to have other-than-temporary impairment and the bond insurer for those securities was determined unable to cover the estimated losses.
The losses mean that U.S. Central has an accumulated deficit greater than all of its paid-in-capital and membership capital shares, wiping out all of its 27 member corporates’ capital.
NCUA, which took the one-time $52 billion central bank for credit unions under conservatorship on March 20, said it continues its financial support for U.S. Central, which includes a guarantee of $10 billion of debt, a $10 billion line of credit and a guarantee of up to $3 billion of retained earnings deficit, in addition to a $1 billion emergency loan made in January.
