The retrenchment at the $710 million Silver State Schools Credit Union, Nevada's largest, continues unabated this week with announcement of a 2% pay cut—a yearly savings of $150,000—effective in September.
The Las Vegas CU also disclosed it is no longer a member of the California/Nevada Credit Union League.
In a statement, David Rhamy, president/CEO of the privately insured CU, said that "although we reported a marginal profit for the first quarter of 2011, we remain wary of the Nevada economy and will continue to prepare for difficult financial times ahead."
Rhamy, who runs Silver State under the watchful eye of an on-premise auditing team hired by Ohio-based American Share Insurance Inc., said the across-the-board salary reduction impacting 226 employees is in line with an ongoing drive to cut operating expenses, noting that last year Silver State reduced such expenses 15%.
"We are on track to reduce operating expense another 10% by the end of 2011," said Rhamy.
Earlier this month, the long-ailing Las Vegas CU said it would be closing two grocery store branches in suburban Henderson bringing to eight the number of statewide facilities closed since 2009.
Silver State now has 12 offices in the Las Vegas and Reno markets, down from the 20 several years ago. The CU, which has 64,000 members, did earn $90,000 in the first quarter, ending nine consecutive quarters of losses but its net worth remains at 4.3%.
In February 2010, ASI extended Silver State a $22 million subordinated loan which was renewed earlier this year.
In reporting on its condition Monday apparently based on ASI statistics, the Las Vegas Review-Journal noted that Silver State has $43.7 million in loans more than two months past due. It charged off $6.7 million in loans and recovered $860,000 on charged off loans during the first quarter. Silver State set aside $22.5 million as a reserve for loan losses over the last two years.
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