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News Now

Washington
NCUA Update Of Legacy Asset Information Suggests Expected Losses Will Be Lower: CUNA
ALEXANDRIA, Va. (3/29/13)--The National Credit Union Administration Thursday announced it has updated its websites showing both realized losses for the Temporary Corporate CU Stabilization Fund through December 2012 and expected remaining assessments.

In its announcement release, the NCUA included a "Questions and Answers" document containing the latest information about costs incurred to date and projected future assessment ranges over the life of the stabilization fund. Use the resource link below to access this important information.

The website update followed a Wednesday release of the agency's audited financial statements for the stabilization fund.

Total projected assessments declined $900 million at the upper end between July 2012 and December 2012, the NCUA said, adding that total future remaining assessments are now projected to range between $1.6 billion and $3.9 billion. In comparison, six months ago the total range was $1.9 billion to $4.8 billion. 

On the downside, although not unexpected, the cumulative realized losses and implied writedowns now amount to $6.1 billion, exceeding the combined capital of the five failed corporates at the time of their conservatorships.

On the plus side, the midpoint of the range of remaining assessments dropped by $600 million, from $3.35 billion to $2.75 billion.  

Credit Union National Association Chief Economist Bill Hampel noted that with the revised estimates, the $2.75 billion midpoint could be fully paid with just over three assessments at last year's rate of 9.5 basis points (bp) of insured shares.  If spread over nine years, the annual assessment would only be about 2.5 basis points.
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