Sign In To Keep Reading!
Need To Register?
Thank you for your interest in reading the fantastic content we have on CreditUnions.com! All users must log in to read, research, browse, and have fun on CreditUnions.com. It's free to create an account.
Learn What You're Missing
Upgrade Your Subscription
Back to CreditUnions.com
Read & Watch
Deposits & Payments
Operations & Technology
Search & Analyze
Find A Credit Union
Find A Credit Union Executive
Build A Peer Group
Strategy & Performance
Anatomy Of A Credit Union
Market Share Guides
Credit Union Directory
How Community 1st Plans To Build Business ...
A Five-Year Plan To Hit $1 Billion In Asse...
Auto Market Share In 3Q 2016
How To Eliminate Fees And Improve The Memb...
A Strategy For ALM Years In The Making
Why Pioneer FCU Tops The Leader Boards
Third Quarter 2016 Shares By The Numbers
How To Cross $10 Billion And Keep On Going
A Strategy To Serve C/D Paper Borrowers
It's Time For Student Loan Refinancing
5 Tips To Survive Multiple Mergers
What Lurks In The Dark Web?
What To Listen For When The NCUA Board Discusses The Revised RBC Rule
What Role Did The Practitioners Council Play In NCUA’s Revised Risk-Based Capital Rule?
Will NCUA’s Revised RBC Rule Benefit From Banking Regulators' Experience?
First Quarter Growth In 2015 Is Critical To Sustain Momentum
NCUA Owes Credit Unions $2 Billion In TCCUSF Refunds
Industry Performance (3Q 2015)
4 Ratios All Staff Members Should Know
How Patelco Credit Union Aligned Its Leadership Team Around Strategy, Language, And Framework
Industry Performance (1Q 2016)
Industry Performance By The Numbers (4Q 2015)
NCUA’s Voluntary Prepayment
Where are NCUA’s Honest Numbers?
NCUA Uses PIMCO to Implement New Accounting Practice: Mark-to-Model
Interview with Filson: NCUA Conservatorship & its Impact on Credit Unions
Timeless Wisdom in a Timely Moment: We Don't Run Credit Unions
March 30, 2009
NCUA needs to put the skids on.
Chip, As always, I enjoy your comments and review. I am curious as to the "solutions" available you reference and how you see the implementation of those solutions. Thanks
Glenn Strebe, CEO Air Academy FCU
Thank you for being the rational, yet poignant voice when the industry needs it the most. Bravo!
Thank you for continuing to voice your concerns. We agree that other options should be considered!
Chip, I hope your thoughtful (and thought provoking)commentary makes its way to the NCUA board and staff. It should give them great pause...! And cause prompt corrective action from NCUA!
Excellent article! The question is: After it is all said and done, what can we do? This movement needs a leader; where is Dan Mica? Having lunch with Obama in England?
Chip, Your continued brilliant analysis of this problem just proves that the pen indeed is still mightier than the sword.
I think this arbitrary decision will greatly affect CUPAC donations due to donors not feeling they are being properly represented. As credit unions we have to behave differently than our banking counterparts to justify our existence. I hope a change of heart is realized on this very important matter.
I agree! Either give us all the info you have to warrant these major adjustments to our bottom line, or we won't comply. My concern is: Where was NCUA when US Central and Wescorp were booking these types of investments. Will there be other corporates on the conservatorship chopping block soon?
Thank you so much Chip. This premature and rash act by the NCUA will directly affect millions of Americans. At a time when credit is desperately tight, the NCUA has needlessly taken 100 billion out of the lending pool. Does the Obama Administration think this is a good thing? Wasn't transparency a cornerstone of his campaign? If I were a Republican trying to poke holes in Obama's programs, I would start right here. It's the perfect storm -- millions of Americans impacted, a regulator showing no signs of transparency, navel gazing to the point where the numbers don't make any sense, and worst of all, an ivory tower- behind the beltway mentality, that ignores the suffering of real Americans. If this is the Obama Administration, I'd like to take back my vote -- and so will everyone who is denied a loan because of this.
Relying on gubment regulators, especially with the current administration, to use common sense in fixing this situation is a futile exercise. Of course, I am ever the cynic.
Chip, Rock and Roll! Government bureaucracy is still alive and well.
Thank you for saying what needed to be said!
WOW!!! Thank you for stating in a public forum what the entire industry is thinking!!! We need some common sense and level headed thought process applied to this unique environment. Thanks again Chip for leading the charge!
This is a statement that any custodian of credit union member capital must ask to be deemed a credible fiduciary. The suspect seizure of this capital by the government, cloaked in secrecy, is so incredibly incoherent with the spirit of democracy and the rule of law as to shock the imagination. I see Mr Filson and team leading the charge. It does make me wonder what kind of backroom dealings are transpiring with the other industry organizations who need to be in the open and committed, as well as clear, and compelling (CUNA, NAFCU, etc.). Perhaps we may want to rethink the payment of dues to those who acutally work on our behalf!
The NCUA's rash behavior and overreaction with conservatorships makes me wonder if there isn't some unknown NCUA agenda that is being served by the action. Does our regulator want to change the corporate cu model through hostile takeover?
Hi Chip, maybe the reason they(NCUA) are not telling us the whole story is the OTHER corporate CU's are in bad shape too. Remember there are 26 of them, oops 24 now and counting. I wonder when the next e-mail from the NCUA with more bad news will show up ??
Amen to this! We need a voice!
Chip, Thank you for continueing the discussion. Your comments are welcome and helpful. NCUA, credit union leaders, credit union volunteers and others in the credit union movement should now resolve to work together to come up with the best solution. The current solution is not the best solution. The rhetoric about "honest numbers", perks, and the lack of tranparency will work against NCUA. Just as some of the rhetoric about NCUA will work against credit unions.. If we want to restore the corporate system; if we want to retain an independent credit union regulator; and if we want to continue the credit union system as an alternative to for profit banks then we have to find a way to work together to solve this problem. Your leadership shows that credit union leaders are serious about solving this problem. The FDIC has recognized that they could not replenish their insurance fund in one year. The FDIC recognizes that anything they do that adds an undue burden on banks during this crisis will only prolong and deepen the crisis. NCUA should follow the lead of FDIC. We need to mitigate the burden on credit unions. We need to restore trust. We need to understand how NCUA determined the loss reserves. NCUA should share the PIMCO report with the credit union system. If they want us to be part of the solution we have to understand the problem. There is now a lack of trust. There was no advance warning, there was no build up--just a sudden and unexpected monumental loss. The first step in restoring that trust is to share the analysis and the PIMCO report. NCUA has said that they want credit unions to continue making deposits in corporate credit unions. The furture corporate credit union system will likely depend on capital supplied by member credit unions. Given the level of trust that now exists that seems unlikely. Henry
Excellent discussion,. Now these facts need to be disseminated to Congress members to inform them of what NCUA has already done and is now trying to get a law passed to legalize after the fact.
I'm glad that we have a strong advocate for the credit union movement. Congratulations Chip for being out in front on this issue from the beginning.
It is truly ironic that after years of hard work at successfully building a strong, competitive image, credit unions must suffer yet another unnecessary and unrealistic attempt at CYA by Regulators who know not what they do.
We should learn from history. Did we learn anything from CapCorp
How can you trust the people who continued to tell us these losses are "temporary" for the past two years now? What exactly does temporary mean then, to maturity? That doesn't seem too temporary. The NCUA was on this same line of reasoning until recently (thank goodness). The PIMCO report is the tip of the iceberg, things will most certainly get worse.
Chip, as the past President/CEO of Corporate Credit Union of Arizona and Vice-Chairman of U.S. Central, I could not agree with you more! The actions by NCUA are clearly NOT in the best interest of the movement at large and certainly of the Corporate credit unions. CapCorp is not the only Corporate that the agency tried to bully. NCUA tried to put the Corporate Credit Union of Arizona into convseratorship in 1984 but thanks to R.C. Roberston and the credit unions of Arizona, the effort was thwarted and the corporate is still alive and well today. In that instance, the agency forced the immediate sale of investments resulting in a $4 million loss. If the investments would have been held 1 more year, the net profit would have been $4 million or an $8 million swing! NCUA clearly does not understand investments or investing and is in my opinion, totally responsible for the current Corporate credit union dilemma.
Great article, thank you for posting it! I agree with many reader comments and find the CapCorp comment spot on. I think NCUA's days are probably numbered. The dire situation we're all in, as well as how we got here, will likely justify the Obama administration's desire to expand powers for the Treasury and FDIC, as well as consolidate the regulatory function. Hello Super Regulator.
Thanks for your article Chip. Will you expand on the alternative methods and solutions that are available to NCUA to resolve the current situation?
Chip, I elect you our leader to help us get through this mess. What should be our next steps? March on Washington to get Obama and Geithner's attention? We need TARP funds for the NCUA and natural person credit unions that are extremely impacted by the recession. Otherwise, if the NCUA continues on this warpath, we are going to see more failures. It worries me that they are launching a tv commercial campaign to boost consumer confidence in credit unions (during the basketball championships!). Is this a preemptive strike before more takeovers???
Chip: Your comments are spot on. The first time I met the NCUA chair was at a large credit union meeting in DC in Nov. last year. His comments included words to the effect that he was "going to fix the corporate CU problem". None of the attendees had heard this prior to the meeting. There was obviously something going on at the NCUA then which resulted in the subsequent actions. The proposed write downs will result in increased NCUA costs as more credit unions are impacted by the HR 1151 legacy of PCA. More income from the insurance fund will be used to support this. Additionally, some credit unions ability to grow will be stymied because growth may result in PCA for credit unions whose reserves fall below 6%. The future consequences of NCUA's precipitous actions will cause additional negative consequences. Gordon
Chip, It is so clear that your comments reflect a true appreciation for the credit union movement and an understanding that there will be unintended consequences that will put increased pressure on the industry at the worst possible time. The assessments will impact natural person credit unions' ability to serve their members - loan production is already slowing, asset growth will be next, fees are rising, and innovations will be put on the backburner. Doesn't sound very healthy to me.
What To Listen For When The NCUA Board D...
Industry Performance (3Q 2015)
NCUA’s Voluntary Prepayment
1001 Connecticut Ave. NW Suite 1001
Washington, DC 20036
P: 800-446-7453 F: 800-878-4712
© 2017 Callahan & Associates, Inc.
All rights reserved