Cost of Credit Union Failures in 2018 Jumps to $792.5 Million
The board also approves a final rule designed to identify in one section maturity limits applicable to loans made by federal CUs.
The cost of credit union failures during 2018 totaled $792.5 million, a jump of more than $768 million over last year, NCUA Chief Financial Officer Rendell Jones told the agency board Thursday.
The $792.5 million is an increase from the $785 million the agency reported the share insurance fund lost due to failures in its end-of-year financial report.
In 2017, 10 credit unions failed; in 2018, eight failed.
As has been the case in the past, agency officials did not discuss specific losses during Thursday’s meeting.
The agency has said that a large portion of the share insurance fund losses can be attributed to the failure of two credit unions—Melrose Credit Union and LOMTO Federal Credit Union.
Those two institutions faced millions of dollars in losses for loans made with taxi medallions as collateral.
Teachers Federal Credit Union took over both credit union but did not take on any of the taxi-related loans.
The NCUA’s Inspector General is required to issue reports on the losses at each of those credit unions, but has not yet made those reports public.
At Thursday’s meeting, the board also approved a final rule designed to identify in one section maturity limits applicable to loans made by federal credit unions.
Board Chairman J. Mark McWatters referred to the change as a “clean up rule” intended to simplify regulations.