WARRENVILLE, Ill. – Members United Corporate FCU said yesterday last month’s additional write-down of capital at U.S. Central FCU created a $78 million loss for the month of July, bringing year-to-date losses to $150.6 million.
The $9 billion corporate credit union told its members that July’s loss was the result of an additional $80.9 million write-down of the value of its membership capital shares at U.S. Central. Members United has written-down its U.S. Central by a total of $233.7 million, and has another $74.6 million remaining at U.S. Central, which is also in jeopardy.
The combination of U.S. Central write-downs and losses on investments has depleted capital at Members United by $619.7 million in the past 12 months, more than halving the corporate’s capital ratio to 3.12%. During that time, member capital, which includes retained earnings, paid-in-capital and membership capital shares, has declined from $894.7 million to $275 million.
The depletion of capital will have a trickle-down effect on the more than 2,000 credit union members of Members United, who will, in turn, have to write-down the value of their membership capital shares in Members United.
The corporate told its members they will probably have to write down the value of their membership capital shares in Members United by between 42% and 58%, or from $199.6 million to $275.7 million.
Representatives of Members United did not immediately respond to requests for comment.
