An Opportunity for Real Return on the Corporate Credit Union Takeovers

Today, Co-Ops for Change will post spreadsheets that list all of the legacy assets by CUSIP number of the five corporates closed by NCUA, in 2009-2010 in the wake of the Great Recession.

Access Spreadsheets

The conservatorship of these assets was the single most significant event in the credit union system during the crisis. Until now, credit union owners have had to take the wisdom of this action on faith. The credit unions who owned those assets now will have the opportunity – as owners should – to review the performance of those assets. It is not clear that this type of crisis management has been studied, reviewed or improved upon, yet it is a tool that has been used many times.

We invite everyone with a stake in the credit union system to join the dialogue about what can be learned to improve our system and its regulatory process. Only from acting on this learning will credit unions earn a real return on the billions they invested in the takeovers.

Any investment security can be updated for current principal value or loss by any visitor to the site. Each proposed entry can be temporary until reviewed using Bloomberg or another expert market data for reasonableness.  Having an open, “crowd-sourced” tracking system gives the credit union community access to the latest data on each corporate’s portfolio taken to collateralize the NCUA Guaranteed Notes (NGN). Where an actual or implied cash loss has occurred, these will be posted and totaled on an ongoing basis.

The spreadsheet information can be compared with the last available OTTI reserves, which each of the five corporates had established, and with expenses from capital, as of June 2010. The remaining capital as of the same date is also shown.  By providing an ongoing, transparent, real-time tracking of these assets, the status of each corporate’s members’ remaining capital value can be tracked and the potential for recovery established.

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