Conserved Pomona Postal FCU Acquired by Neighbor & Va. CU Liquidated
CU SoCal picks up the credit union two months after the NCUA took control. The agency also liquidates Portsmouth Schools FCU.
Credit Union of Southern California on Saturday acquired a small, nearby credit union that the NCUA had conserved in November after its net worth fell into undercapitalized territory.
The NCUA announced Monday that Pomona Postal Federal Credit Union ($4.1 million in assets, 717 members) was merged on Jan. 1 into CU SoCal ($2.2 billion in assets, 129,617 members).
The credit union chartered in 1964 served employees of the post office in Pomona, Calif., a Los Angeles County city 21 miles east of Whittier, also in the county and headquarters of CU SoCal.
The NCUA conserved Pomona Postal on Nov. 5, and appointed itself as the conservator.
“The agency worked to address issues affecting the credit union’s safety and soundness,” its news release Monday said. “As conservator, the NCUA determined that merging Pomona Postal Federal Credit Union into Credit Union of Southern California was in the best interests of its members.”
Pomona Postal’s losses started in 2018, and it piled up $587,565 in losses in the three years ending Dec. 31, 2020.
The credit union had a net loss of $6,194 in the three months ending March 31, 2021, followed by a $27,130 gain in the second quarter. However, it took a $161,280 loss in the third quarter, primarily from a $155,241 provision for loan losses. In part that reflected a 60-day delinquency rate of 1.76% at Sept. 30, up from 0.52% on June 30 and no 60-day delinquencies reported as of Sept. 30, 2020.
Its net worth ratio fell to 3.31% at Sept. 30, which the NCUA classified as “Significantly Undercapitalized.” It was down from 6.96% on June 30, which is just under the 7% threshold for “Well Capitalized” credit unions.
The NCUA conserved five credit unions in 2021. Besides Pomona Postal FCU, they were:
1. Community-Owned Federal Credit Union in Charleston, S.C. ($2.4 million in assets, 711 members), which was closed in September 2021.
2. Indianapolis’ Newspaper Federal Credit Union of Indianapolis ($6.3 million in assets, 1,143 members). Most of its shares were assumed in March 2021 by the $2 billion Elements Financial Federal Credit Union ($2 billion in assets, 119,907 members), also based in Indianapolis.
3. Edinburg Teachers Credit Union in Edinburg, Texas ($104.7 million in assets, 7,487 members), which the NCUA conserved March 26, 2021, and remains under conservatorship.
4. Empire Financial Federal Credit Union in New York City ($6.7 million in assets, 353 members), which the NCUA conserved May 24, 2021 and also remains under the federal agency’s conservatorship.
Late Thursday afternoon, the federal agency announced the liquidation of the $2.2 million Portsmouth Schools Federal Credit Union in Portsmouth, Va., which posted a net loss of $204,558 for the nine months ending Sept. 30 and a net worth of -3.90% as of Sept. 30, according to NCUA financial performance reports.
Since 2017, the credit union has recorded annual five-figure net losses, NCUA financial results showed.
The $2.1 billion Newport News Shipbuilding Employees Credit Union in Newport News, Va., doing business as BayPort Credit Union, immediately assumed Portsmouth Schools Federal Credit Union’s assets, member shares and loans, the federal agency said in a prepared statement.
Chartered in 1942, Portsmouth Schools FCU served 870 members, which included teachers, employees, students and family members of various schools within the Portsmouth public school system.