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MIRAMAR, Fla. – NCUA, which is predicting increasing loss from large credit union failures in the coming months, was trying last week to keep the costs down for the merger of Eastern Financial Florida CU, the largest natural person credit union failure ever.

BOSTON — Weighed down by the declining economy, CUNA is expected to announce more job cuts in the coming days.

ALEXANDRIA, Va. — Even as credit unions were cheering the new seven-year installment plan for the corporate credit union bailout new charges were emerging last week that will hit their bottom line by year-end.

ALEXANDRIA, Va. – The continued deterioration of the mortgage market, as foreclosures and delinquencies rise, is expected to cause increasing losses on billions of dollars of mortgage-backed securities being held by corporate credit unions, according to NCUA.

ALEXANDRIA, Va. – NCUA told credit unions yesterday they can expect to pay an additional charge of about $1 billion into the National CU Share Insurance Fund this September.

HARRISBURG, Penn.–Credit unions in this state have agreed to participate in “Get Help Now,” a volunteer initiative launched by Gov. Edward Rendell designed to provide financial and legal help to many Pennsylvanians who still face difficult situations while the economic recovery takes hold.In a statewide webcast, Governor Rendell announced he has enlisted attorneys, banking and mortgage professionals, and financial analysts who are knowledgeable in the area of finance, credit, and/or bankruptcy to serve on help desks in many of the county bar association offices, the Pennsylvania CU Association reported.Representing credit unions, there were 28 in attendance from the Pennsylvania Credit Union Association and 15 credit unions, including Cross Valley FCU, People's Choice FCU, Berks Community FCU, CTCE FCU, Lancaster Postal Employees FCU, Members 1st FCU, Pennsylvania State Employees Credit Union, Belco Community Credit Union, Main Line Health Employees FCU, HealthCare First Credit Union, Erie FCU, Erie General Electric FCU, TruMark Financial Credit Union, Sb1 FCU, and riverset credit union.

BOSTON–CUNA Chief Economist Bill Hampel, who for the past several years had argued credit union capital levels have been too high, acknowledged he has altered his view on the issue, although not significantly.“Now, instead of being comfortable with capital between 7% and 9%, I would recommend between eight and ten,” he said during CUNA’s America’s Credit Union Conference here. “What is going to happen in Washington, if anything, in the next year or so will be an increase in capital requirements. As for secondary capital, I think Congress might be willing to allow access to secondary capital now that it realizes the importance of capital.”

WASHINGTON–Though existing home sales showed its first back-to-back monthly gain since 2005, a separate report shows homeowners’ equity is still falling.Existing home sales in May increased by 2.4%. And though year-over-year, existing home sales are down by 3.6%, sales of single-family homes and condominiums increased by 1.9% and 6.1% respectively.Median housing prices also showed a monthly gain of 3.8%, but year-over-year, they have fallen by 16.8%.Overall, NAFCU Economist Katrin O’Connor said, the housing market continues to show signs of stabilization, benefiting from lower prices and first-time buyer tax credits.“At the same time, distressed property sales declined to one third of all sales,” NAFCU reported. “Foreclosures further depressed home prices, a trend that is expected to continue over the next few months. As long as mortgage rates do not increase significantly higher, we should start to see a stabilization in home prices and a clearing of the market’s excess inventory by the first half of next year. If the appraisal problems do not get resolved quickly, however, this might delay the housing market recovery and result in a further surge in foreclosures.In a separate report released by the Joint Center for Housing Studies at Harvard University, U.S. home equity fell by $2.5 trillion in 2008 and is now off $5.9 trillion from 2005–more than 43%.Southwest Corporate Economist Brian Turner said the study indicates that in states where housing prices have taken the biggest hits, home values have been diluted to levels resembling the 1990s and early 2000.“The study reports that after slipping 1.7% in 2007, the median price of existing single-family homes fell another 9.8% in 2008. This would put the aggregate decline in prices at approximately 30% for the period of October 2005 and January 2009,” Turner explained. “Still, home equity appears to remain more important to household wealth than other investments as home equity on average is at least triple the amount associated with household investment. Given the combination of low values and higher loan balances from cashing out equity, Moody’s estimates that more than 14 million households own homes that are worth less than their outstanding mortgage.”

BOSTON–How much net worth does a credit union really need? The figure is different for every credit union, but one CFO is cautioning it’s important to properly analyze the risks at CU faces in order to answer the question.Dan LeClerc, CFO with the $176-million Lacamas Credit Union in Washington State, said his fellow CFOs and CEOs must be willing to consider a wider range of risk scenarios that perhaps they have in the past, across the full spectrum of risk: Interest rate risk, liquidity risk, credit risk, operational risk and regulatory risk. “When you’re going through these risks, think creatively,” he said, noting he never imagined a year ago that his credit union’s membership capital in its corporate would be at risk, which is why he called for a wide number of variables when doing stress testing.In remarks to CUNA’s America’s Credit Union Conference, LeClerc said the risks credit unions must build into their stress tests and models moving forward include risks such as de-coupled debit cards, how to pay for additional corporate bailouts, high inflation rates, and the disappearance of automobiles (and related financing) purchased through traditional dealers.

BOSTON–Not surprisingly, the net worth of individual credit unions and the industry as a whole received a fair amount of attention during CUNA’s America’s Credit Union Conference here.Matt Davidson, VP with the California/Nevada Credit Union Leagues and a former regulator in Ohio, said it’s been his experience that credit unions suffering lagging or declining net worth often get there as the result of a slow decline rather than one major event. ”I think we need to hop out of our situations and realize when the situation is getting weak and take appropriate action,” said Davidson.He urged paying attention to peer group leaders such as CEFCU in Peoria, Ill., Space Coast CU in Melbourne, Fla., and San Diego County CU in California, which have posted positive numbers in part by watching their collective wallets. “What do they have in common? Low operating expenses. It’s not that they do things cheaply, they do things efficiently,” said Davidson. He cited a quote from Doug Samuels, CEO at Space Coast, which is engaged in a “relentless drive for efficiency.”“To be efficient, you can take a hatchet to expenses, or you can know how much it costs to provide a service,” Davidson said. “Decide if that’s how you want to spend your member’s money. You need to employ activity based costing and product profitability management. These help you implement the proper cost accounting to make a decision on a service or a loan.”

MODESTO, Calif. – Self-Help FCU, the recently formed national charter for the iconic North Carolina-based community development group, said Friday it has acquired Community Trust CU, a struggling $43 million serving low-income communities in California’s Central Valley.

WASHINGTON – The FDIC closed three small banks on Friday, bringing the number of bank failures to 40 so far this year as the recession and delinquent loans erode the health of financial institutions.

ALEXANDRIA, Va. – Several more large credit unions were cleared to acquire troubled smaller ones, NCUA reported Friday, continuing a trend.

WARRENVILLE, Ill. — Members United Corporate FCU, which reported a $511- million loss last month, said Friday it is embarking on its second round of lay-offs, eliminating 39 full-time positions and closing its Minnesota office.

BIRMINGHAM, Ala. — What does Q3 and Q4 hold? Apparently, more mergers.

TALLAHASSEE, Fla. — The points of pain have many CUs turning to point of sale.

SCOTTSDALE, Ariz. — The next six months will keep credit unions focused on cost-cutting and efficiency improvements, which elevates the importance of using strong benchmarks before making adjustments, suggests Cornerstone Advisors.

ONTARIO, Calif. — Despite two of the Big 3 automakers having filed for bankruptcy, Credit Union Direct Lending predicts that CU auto loan volume will remain level for the rest of the year and increase significantly in 2010.

GLASTONBURY, Conn. — Delaying IT purchases, especially those that spur growth or drive efficiencies, could lead credit unions to experience a downturn longer than what's delivered by the economy, suggests one person.

TEMPE, Ariz. — The Corporate CU Stabilization Plan is breathing life into 2010 marketing budgets, according to one person.