Corp. CU update: NCUA begins stabilization process

ALEXANDRIA, Va. (6/8/09)--The National Credit Union Administration (NCUA) in its most recent update on the status of the corporate credit union system said that it has begun to use the Temporary Corporate Credit Union Stabilization Fund (TCCUSF) to cover corporate stabilization-related expenses.

In a Tuesday press release, the NCUA said that the implementation of the TCCUSF will allow natural person credit unions to "reflect a fully restored National Credit Union Share Insurance Fund (NCUSIF) deposit on their June 30 call reports."

According to the release, the TCCUSF has relieved the NCUSIF "from any reserve requirements" related to U.S. Central FCU's capital note by paying $1 billion into the NCUSIF.

The TCCUSF will also now oversee the Temporary Corporate Credit Union Share Guarantee Program (TCUSGP) and the Temporary Corporate Credit Union Liquidity Guarantee Program (TCCULGP), the NCUA added. The majority of corporate credit unions have agreed to take part in the TCCULGP, the NCUA said.

The NCUA also updated the status of U.S. Central and Western Corporate Federal Credit Union (WesCorp), reporting that "normal operations" at those two credit unions "continue without interruption."

WesCorp announced that it expects to recognize a 30% reduction in operating costs this year due to a number of cost cutting measures, including "consolidations and staff reductions," the release said.

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