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CU operating normally after cease and desist order
TAMPA, Fla. (5/5/10)--Bay Gulf CU, Tampa, Fla., is operating normally after the Florida Office of Regulation issued a cease and desist order to the credit union April 29. The order was issued to the credit union because of a difference in the interpretation of accounting principles regarding some troubled debts, Bill DeMare, president/CEO, told News Now. It has since been resolved, and there have been no changes in management. The credit union has excess liquidity, and member deposits are safe, he added. The credit union has acted on much of the order, and has submitted a plan to raise its reserves. As of March 31, Bay Gulf’s net worth was 5.24% of total assets. Adequately capitalized credit unions are required to have at least 6%. The credit union submitted a capital restoration plan to regulators that will help it reach 7% net worth as of September 2012. The National Credit Union Administration is reviewing the plan, he said. “We are moving along,” DeMare said. “We’re not finished with April yet, but we’re expecting a strong quarter.” The credit union reported a $823,706 loss for the first quarter of 2010. DeMare noted that Bay Gulf modified about 700 consumer loans--including car and home loans. More than 80% have been paid off (Tampa Bay Business Journal May 3). “We thought we were doing the right thing,” he said. “We helped a lot of people. We don’t regret that.” The credit union has $140.7 million in assets as of March 31.


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