WASHINGTON -- A nationwide survey of credit unions indicates support among them for using Treasury funds as a back up for the National Credit Union Share Insurance Fund (NCUSIF), according to results reported today by CUNA.

Results of the survey conducted Feb. 12-16 showed more than 55 percent of those responding supported CUNA’s approach of employing a Treasury back up for the NCUSIF as it is tapped to pay for the National Credit Union Administration’s (NCUA) Corporate Stabilization Program (CSP).

The responders agreed with the statement that “CUNA should advocate for a set-aside of TARP (Troubled Asset Relief Program) funds to backstop the NCUA’s guarantee of deposits by natural person credit unions in corporate credit unions, only to be accessed if at least $500 million of loss from corporates is first absorbed by the NCUSIF.”

Thirty-six percent disagreed with the statement, and 9 percent were neutral.

The results for the “NCUSIF back-up” question reflected overall views expressed by respondents favoring a Treasury back-stop as one tool to assist in mitigating costs for resolving corporate credit union issues. However, at the same time respondents largely viewed using Treasury help for natural person credit unions unfavorably.

Additionally, the survey results show respondents have strong views about the use of Treasury funds. In almost every case of the six questions, “agree strongly” and “disagree strongly” are the most common responses.

Further, credit unions appear unwilling to completely rule out use of Treasury help in all cases. Overall, a majority (56 percent) indicated “disagreement” when asked to rate the notion that “CUNA should not advocate for TARP funds under any circumstances and in any conditions.”

On the other hand, just 34 percent indicated “agreement” with that statement.

The survey was sent to more than 5,000 credit unions nationwide. About 1,600 credit unions responded to the survey, a 32 percent response rate. Requests for participation were included in two editions of CUNA’s daily news online report, NewsNow.

In another development, the CUNA Board of Directors, upon review of the survey results, voted at their recent meeting (in conjunction with the CUNA Governmental Affairs Conference, GAC) to keep all options open in finding alternatives for mitigating costs of credit unions of the NCUA CSP. That includes seeking a Treasury back up for the NCUSIF.

“We acknowledge strong opinions are held on these issues," said CUNA Chairman Kris Mecham, CEO of Deseret First Credit Union, Salt Lake City, Utah. "This was no easy decision for the CUNA Board, but it is in the long-term interests of the credit union movement."

It is possible that no Treasury funds would ever be tapped, in that other alternatives identified by CUNA would further mitigate costs for credit unions. Among those alternatives:

• Use the CLF as a source of funding, for loans or capital support.
• Improve the accounting treatment of assets that are other-than-temporarily-impaired (OTTI).
• Pursue accounting issues that could allow the NCUSIF to recognize its insurance costs over time
• Obtain long-term deposits from CUs into corporates
• Expand NCUA's Credit Union System Investment Program (CU SIP) to make it more attractive to credit unions

For additional results of the survey, contact CUNA.