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Western Bridge members service will be uninterrupted--NCUA
ALEXANDRIA, Va. (9/2/11)--United Resources FCU's bid to succeed Western Bridge Corporate FCU fell short of the bridge corporate's stated capital subscriptions goal of $200 million Wednesday, said the National Credit Union Administration (NCUA). Scott Hunt, agent for the conservator of Western Bridge, informed members Thursday in a letter that the corporate had not met its member-driven goal by Wednesday's deadline. However, NCUA "remains firmly committed to ensuring continuity of service and operations for all Western Bridge member credit unions," Hunt wrote in the letter. "We have no immediate plans to shutter Western Bridge's operations. NCUA is committed to an orderly and timely resolution that ensures uninterrupted service to all member credit unions." Credit Union National Association (CUNA) President/CEO Bill Cheney said, "We understand that a number of Western Bridge’s members are disappointed that the capital target was not reached. We believe that the agency’s actions and statement Thursday reflect its willingness to consider options for uninterrupted services to all Western Bridge member credit unions; that has been a priority of CUNA’s, and we will continue discussions with NCUA to be sure that is indeed the case. "At a meeting today with NCUA officials, CUNA’s Corporate Credit Union Next Steps Working Group will seek assurances that natural person credit unions will continue to have access to the services that they need," Cheney added. Hunt's memo also noted that "while Western Bridge is a temporary entity, NCUA seeks a holistic approach in addressing member credit union service needs that will not require significant changes to how your credit union currently does business. However, credit unions that choose to directly seek an alternative provider in the coming months are still free to do so." During the fall 2010 corporate system resolution town hall meetings, audiences were briefed on the possible inability of one or more corporates to achieve their planned capital raise. NCUA planned for that contingency when it developed its corporate system resolution plan. The agency said it is enacting its contingency plan to provide an alternative, through which Western Bridge members can continue to obtain corporate services for the long term. The service infrastructure and member service volume at Western Bridge have significant value, said NCUA, which is working to solicit acquirers to obtain the business as a package transaction that will have minimal impact on member credit unions. "This may be accomplished through a merger with or an acquisition by another corporate or wholesale financial institution," said NCUA. NCUA's efforts to negotiate for a package transaction "will be best maximized by retaining the volume of members and service activity that currently exists at Western Bridge. Stabilizing the membership and service base maintains the value of the institution for potential bidders," said NCUA. "We believe the new plan will provide critical elements that each credit union will want to consider as part of its due diligence process before making a final decision on its future service needs," said Hunt's letter. "As such, member credit unions may want to continue utilizing Western Bridge services during this process." NCUA said it expects a solicitation and bidding process to begin soon. To enable a fair bidding process, obtain the best possible solution for member credit unions, and ensure the best financial outcome, within sound public policy, for the Temporary Corporate Credit Union Stabilization Fund, much of the process must be done confidentially, said the agency. NCUA will keep Western Bridge members informed "to the greatest extent possible." Some members already may have finalized a decision to transition to other service providers. NCUA encouraged every member, as part of their individual contingency planning, "to have a full understanding of the products and services they receive from Western Bridge in order to understand the potential effect of a transition to a new provider." NCUA said its staff will work with those credit unions to ensure the process is smooth and timely. NCUA's Frequently Asked Questions about the corporate resolution emphasizes that credit unions do not need to take action at this time, and that their funds are safe. For more, use the link.


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