The biggest and most surprising loss was from VyStar Credit Union of Jacksonville, Fla. ($14 billion in assets, 1 million members).

VyStar lost $100.3 million in the three months ending Dec. 31, or a -2.79% return on average assets, compared with 0.10% ROA a year earlier. For the 12 months it lost $83.8 million, or -0.61% ROA, compared with net income of $24.6 million (0.18% ROA) in 2023.

VyStar said it chose to take the losses to brace for an uncertain future outside the credit union.

Its fourth-quarter revenue minus operating expenses fell 31% from a year earlier, but was still in the black by $16.5 million. But black was swept way into red by the CECL credit loss provision of $116.8 million. And the picture was prettier — but still ugly — for those who measure earnings by swapping provisions for actual net charge-offs. That net operating loss was $62.3 million using its $38 million in net charge-offs for the quarter (or 1.52% of average loans).

In a statement sent to CU Times, VyStar called 2024 “one of our strongest years.”

“However, in December, we made a strategic decision to take bold action to significantly increase our loan loss reserves in response to macroeconomic conditions, as well as pull forward several expenses and accrue for potential liabilities in the future,” VyStar said.

“With the additional provisioning now in place and a number of additional strategic actions and partnerships planned for 2025, we are well-positioned for a quick return to profitability this year and beyond,” it said.

The second-biggest loss came from the Wausau, Wis.-based Connexus ($4.3 billion in assets, 473,925 members). It lost $80.7 million in the fourth quarter, or -7.24% ROA, compared with -0.40% a year earlier. For the 12 months it lost $113.8 million, or -2.36% ROA, compared with net income of $11.7 million (0.22% ROA) in 2023.

In a Jan. 31 news release reviewing 2024, Connexus said it was “challenged by declining net income, slower loan growth, higher cost of funds, and rising delinquencies, ultimately resulting in a net loss for Connexus in 2024.”

“While 2024 presented significant headwinds, these challenges have further strengthened our resolve and sharpened our focus,” interim President/CEO Chad Rogers said. “Our members faced considerable inflationary pressures, which impacted their financial decisions and led to increased loan losses and margin compression.”

Connexus said it has launched a multi-year profitability strategy “to proactively anticipate and respond to rapidly changing market conditions. The plan emphasizes three core priorities: Investing in risk mitigation disciplines, controlling operating expenses and leveraging diverse revenue opportunities.”

Workers Federal Credit Union of Littleton, Mass. ($2.5 billion in assets, 123,161 members) lost $61.7 million in the fourth quarter, or -9.81%, compared with -1.38% a year earlier. Jay Champion, who was named president/CEO last June, told CU Times that its losses mostly stemmed from a large sell-off of bond investments made when interest rates were low.

Greater Nevada Credit Union of Carson City ($1.7 billion in assets, 88,662 members) lost $34.7 million in the fourth quarter, or -7.83%, compared with -1.12% a year earlier. For the 12 months it lost $37.2 million, or -2.11% ROA, compared with net loss of $10.6 million (-0.59% ROA) in 2023.

Greater Nevada took an $11.4 million provision and $6 million in net charge-offs in the fourth quarter. But it was already in the red before either charge as its income fell 34% and its non-employee operating expenses rose 81%. Employee expenses had virtually no change.

Michael Thomas, Greater Nevada’s chief strategy officer, said the credit union “anticipated these year-end losses and adopted a deliberate, conservative accounting approach.”

Thomas said the losses stem from “one-time events isolated to our commercial lending Credit Union Service Organization (CUSO), primarily involving one-time accounting adjustments dating back to 2021 as well as CECL-based loan loss provisions in the credit union’s commercial loan portfolio on a small number of USDA-guaranteed loans."

He added, “We are working with borrowers and the USDA to resolve these matters over time. While there is a chance of recovering some losses, we decided to recognize the impacts now,” he said. “Our core business remains financially strong and profitable, allowing us to move forward confidently into the future.”

Georgia's Own of Atlanta ($4.2 billion in assets, 240,428 members) lost $23.5 million in the fourth quarter, or -2.23%, compared with -0.31% a year earlier. For the 12 months it lost $14.2 million, or -0.34% ROA, compared with net income of $14.1 million (0.31% ROA) in 2023.

PenFed Credit Union of Tysons, Va. ($31 billion in assets, 2.8 million members) lost $22.3 million in the fourth quarter, or -0.28% ROA, after taking a $151.3 million loan loss provision. The loss is a marked improvement from its $98.1 million loss (-3.24%) in 2023's fourth quarter after a $203.6 million loan loss provision.

PenFed also had a heavy $220.2 million net charge-off in the fourth quarter. The 3.45% net charge-off rate was up from 3.19% a year earlier and 1.53% in the third quarter. PenFed originated $1 billion in loans in the three months ending Dec. 31, down 28.4% from a year earlier, and its loan balance fell 13.8% to $24.9 billion.

For the 12 months, PenFed earned $36.3 million, or 0.11% ROA, compared with net income of $16.8 million (0.05% ROA) in 2023. It cut 293 full-time jobs during 2024, including 62 in the fourth quarter, following cuts of 315 in 2023 and 183 in 2022.

Blue Federal Credit Union of Cheyenne, Wyo. ($2.1 billion in assets, 141,787 members) lost $14.3 million in the fourth quarter, or -2.72%, compared with 0.05% a year earlier. For the 12 months it lost $10.5 million, or -0.52% ROA, compared with net income of $6.8 million (0.37% ROA) in 2023.

Rivermark Community of Oregon City, Ore. ($3.3 billion in assets, 179,805 members) lost $13.2 million in the fourth quarter, or -1.54%, compared with 0.05% a year earlier.

Rivermark more than doubled in size in the fourth quarter as it acquired Advantis Credit Union of Oregon City, which had nearly $2 billion in assets and 88,260 members as of September 2024. CU Times has combined the results of the merged credit unions for periods before the fourth quarter to allow for more accurate historical comparisons.

For the 12 months, Rivermark lost $7.2 million, or -0.22% ROA, compared with net income of $12.2 million (0.36% ROA) in 2023.

Three other credit unions also had net losses exceeding $10 million because their boards chose to pay large special dividends to members that often put them in the red in the fourth quarter.

Contact Jim DuPlessis at [email protected].