The largest loss in this year’s first quarter came from Connexus Credit Union of Wausau, Wis., which lost $13.8 million in the first quarter (ROA -1.30%).

Connexus ($ 4.2 billion in assets, 465,182 members) generated $11.7 million in net income for the 12 months of 2023, but it has recorded losses in each of the five quarters since then. It lost $113.7 million in 2024.

Its net worth ratio was 7.28% on March 31, down from 8.35% a year earlier.

In response to questions about its losses, Connexus emailed a statement to CU Times saying it “remains financially strong, as well as highly responsive to the slowed economic growth, elevated interest rates and wavering consumer confidence impacting our nation.”

The credit union’s statement, much like one it sent out in January, said it and many of its peers have been challenged by declining net income, slower loan growth, a higher cost of funds and rising delinquencies.

“Earlier this year, Connexus launched a comprehensive, multi-year, sustained profitability strategic initiative 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,” Connexus said.

“These foundational enhancements will further strengthen our balance sheet and enable Connexus to seize emerging marketplace opportunities that will directly benefit our members,” it said.

Local Government Federal Credit Union of Raleigh, N.C. ($ 4 billion in assets, 405,040 members) lost $10.4 million in the first quarter (ROA -1.04%). Local Government lost $16.3 million in 2023 and $1.6 million in 2024.

Local Government said the first-quarter loss stems from costs of severing ties with State Employees’ Credit Union of Raleigh ($55.4 billion in assets, 2.9 million members as of March 31) and acquiring Civic Federal Credit Union ($119.3 million in assets, 7,678 members as of June 30, 2024), also of Raleigh.

Local Government was founded in 1983 as a spinoff from SECU in an attempt to please bankers, but it continued to use SECU branches and technology. Local Government decided in 2014 to become more independent. One step was its founding of Civic FCU in 2018 as an all-digital credit union, appointing Dwayne Naylor as its president/CEO. In 2022, Naylor was promoted to president/CEO of both credit unions.

Last September Local Government acquired Civic in a merger, and next month it plans to complete the integration by separating from SECU and adopting the Civic Federal Credit Union name. It also said it would be opening branches across the state. NCUA data showed it went from having only two corporate offices on Sept. 30, 2024 to having 10 branches and the two corporate offices on Dec. 31.

“The first-quarter loss was expected and reflects the cost of becoming independent from SECU this June and building our systems and staff — an important step that strengthens our ability to better serve local government employees across North Carolina,” Local Government said in an email to CU Times. “Supporting these public servants has always been at the heart of what we do, and we’re in a strong financial position and excited about the future.”

Unlike Connexus and Local Government, the third big loss came from a credit union that usually generates strong profits.

Chevron Federal Credit Union of Concord, Calif. ($5.1 billion in assets, 137,968 members) lost $10.4 million in the first quarter (ROA -0.83%).

Chevron’s earnings were spiky, but it had a loss in only one of the previous four quarters. Altogether, it lost $17.4 million in 2023, but earned $32.2 million in 2024.

Chevron said the first-quarter loss was entirely driven by a $10.8 million decline in the value of interest rate derivatives it uses to hedge its long-term mortgage portfolio. The market value of these derivatives increases or decreases each quarter based on changes in interest rates and ultimately converges to zero by maturity, it said in an email to CU Times.

“CFCU continues to be on a strong trajectory in 2025, with outstanding loan and deposit rates for our members, record member experience metrics, a high-quality credit portfolio and investments to develop state-of-the-art capabilities,” Chevron said.

And, lastly, one small credit union reported a $10 million loss, which the NCUA accepted and posted. Turns out it was off by a couple decimals: It was more like a $100,000 loss, according to its revised Call Report.

Contact Jim DuPlessis at [email protected].