New York's tenth largest credit union by assets, the $1.7 billion Melrose CU, was placed into conservatorship Friday by the New York State Department of Financial Services, which appointed the NCUA as the conservator, according to the federal agency.

The state regulator took possession for Melrose CU in Briarwood because of its unsafe and unsound practices initially identified during a an examination by state and federal regulators in 2015. That examination revealed alleged violations of laws and regulations, and significant supervisory concerns, leading the state regulator to issue a consent order against the undercapitalized credit union.

Those areas that Melrose was required to address in the consent order included loan policy deficiencies, the funding of an allowance for loan/lease losses shortfall, and a concentration reduction plan for its $1.5 billion taxi medallion loan portfolio that was underperforming because of fierce competition from ride-sharing services such as Uber and Lyft. Melrose was managing more than 3,000 taxi medallion loans.