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Monday, November 05, 2007

Two More Credit Unions Bite the Dust

by Calculated Risk on 11/05/2007 05:10:00 PM

From the National Credit Union Administration

CAL State 9 Credit Union Is Placed Into Conservatorship (hat tip 4shzl)

The National Credit Union Administration (NCUA) today assumed control of the operations of Cal State 9 Credit Union, a state-chartered, federally insured, community-based credit union in Concord, California.
Service continues uninterrupted at Cal State 9 Credit Union and members are free to make deposits, access funds, make loan payments and use share drafts. While the credit union was placed into conservatorship because of declining financial condition, the decision to conserve a credit union enables the institution to continue normal operations with expert management in place.

Member funds are federally insured up to at least $100,000 per account by the National Credit Union Share Insurance Fund (NCUSIF), a federal fund managed by NCUA and backed by the full faith and credit of the U.S. Government. Members with questions about their insurance coverage can contact NCUA’s Region V Division of Insurance at 602-302-6000 Monday through Friday during business hours.

Cal State 9 Credit Union, originally chartered in 1948 to serve University of California employees, has assets of nearly $388 million and over 29,000 members.
The cause? According to the SFGate: the housing market.
The takeover signals yet another misfortune in the unfolding mortgage crisis in which homeowners are defaulting on their loans and losing their properties. The bulk of Cal State 9's loans are for real estate transactions.

The state's action "is related to the credit union's defaults on mortgages," California Department of Financial Institutions spokeswoman Alana Golden said Saturday.
And a small one in Pennsylvannia: NCUA Closes Green Tree Federal Credit Union
The National Credit Union Administration (NCUA) Board today liquidated the insolvent Green Tree Federal Credit Union, a $7 million association based credit union in Feasterville, Pennsylvania, that served Friends of Briar Bush, a nonprofit nature conservancy located in Glenside, Pennsylvania.

A portion of the credit union’s 500 member accounts were transferred to Freedom Credit Union, Warminster, Pa, a $339 million credit union with branches in close proximity to Green Tree Federal Credit Union members. Due to size, Freedom Credit Union is able to offer the incoming new members a broad range of financial services. The remaining accounts were transferred to NCUA for payout, which occurs within 10 days.