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Mid-Atlantic Corporate reaches 115M in capital conversions
MIDDLETOWN, Pa. (7/7/10)--Mid-Atlantic Corporate FCU announced that as of June 30, it had received capital conversion agreements from 626 credit unions, totaling about $115.5 million in capital. Of that amount, about $107.7 million is in Perpetual Contributed Capital (PCC) and another $7.8 million is in Nonperpetual Capital Accounts (NCA), the corporate said in an update on its website. Of the agreements, 583 are platinum level memberships. The conversions are part of the corporate's plan to create a new membership structure that would convert its existing membership capital into Tier-1 capital. The PCC will be considered Tier-1 capital under the National Credit Union Administration's (NCUA) proposed Regulation Part 704, according to Pennsylvania Credit Union Association's Life is a Highway and New Jersey Credit Union League's The Daily Exchange (July 6). The return of the agreements means Mid-Atlantic Corporate will have more capital holding members than under its previous membership structure, they said. "Mid-Atlantic has been a very conservative, well-run corporate, which provides critical financial services to smaller credit unions," said Bob Marquette, president/CEO of Members 1st FCU, a $1.7 billion asset credit union based in Mechanicsburg, Pa. "We also obtain some financial services from Mid-Atlantic--some of which are difficult to obtain elsewhere. "The losses we experienced at Mid-Atlantic were the result of the structure of the corporate system and the fact that all of the corporates were encouraged to use the expertise and services of U.S. Central FCU to achieve economies of scale. We believe Mid-Atlantic has been a good, solid, dependable business partner and deserves our support," Marquette added. The new membership levels and capital plans will take effect after the publication of NCUA's revised Regulation Part 704, according to Life is a Highway.
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