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Member Deposits Insured up to $250,000 and Member Services Uninterrupted

ALEXANDRIA, Va. (March 23, 2012) – The California Department of Financial Institutions today placed Telesis Community Credit Union into conservatorship and immediately appointed the National Credit Union Administration (NCUA) as conservator. Telesis Community Credit Union is a state-chartered, federally insured credit union headquartered in Chatsworth, Calif. 

Deposits at Telesis Community Credit Union are protected by NCUA up to $250,000. Administered by NCUA, the National Credit Union Share Insurance Fund has the backing of the full faith and credit of the U.S. Government. 

The state placed Telesis Community Credit Union into conservatorship due to a declining financial condition. During the conservatorship, service to Telesis Community Credit Union’s members will continue without interruption, and members can continue to conduct normal financial transactions.

Originally chartered in 1965, Telesis Community Credit Union’s field of membership currently includes, among others, various employer groups and individuals who live, work, worship or go to school in the San Fernando and Santa Clarita valleys or in Ventura County. With assets reported at $318.3 million in the latest Call Report, Telesis Community Credit Union has more than 37,600 members.

The Federal Credit Union Act authorizes the NCUA Board to accept appointment as conservator when necessary to conserve the assets of a federally insured credit union, protect members’ interests, or protect the National Credit Union Share Insurance Fund. Telesis Community Credit Union is the third federally insured credit union placed into conservatorship during 2012. 

Members who have questions about the conservatorship may review the Telesis Community Credit Union Frequently Asked Questions document attached to this release.

Telesis Community Credit Union Frequently Asked Questions

Is my money safe and secure? 

Yes, your account at Telesis Community Credit Union remains safe and fully insured up to the maximums established in federal law.

The National Credit Union Administration (NCUA) through the National Credit Union Share Insurance Fund insures individual accounts up to $250,000 and joint accounts up to $250,000 per member. NCUA also separately protects your IRA and KEOGH retirement accounts up to $250,000.

The Share Insurance Estimator allows you to estimate your share insurance coverage. Once you input the required data, the Share Insurance Estimator produces a report with detailed explanations of your insurance coverage.

For additional questions about your insurance coverage, you may contact NCUA’s Consumer Assistance Center toll free at 800-755-1030. The center answers calls Monday through Friday between 8:00 a.m. and 6:00 p.m. Eastern time. You may also visit the MyCreditUnion.gov website  for more information about your insurance coverage at any time. 

What is the current status of Telesis Community Credit Union? 

The California Department of Financial Institutions placed Telesis Community Credit Union into conservatorship on March 23, 2012, and immediately appointed NCUA as the conservator.

The credit union is open and operating business as usual. During a conservatorship, NCUA’s priority is to protect the credit union’s assets and establish and maintain safe and sound credit union operations. Your money is also protected up to insured limits. 

What is the National Credit Union Administration? 

An agency of the federal government, NCUA, among other things, operates and manages the National Credit Union Share Insurance Fund. Through this fund, NCUA insures accounts at all federally insured credit unions, including your account at Telesis Community Credit Union. 

What is a conservatorship? 

Yes, Telesis Community Credit Union will remain open, operating business as usual, during the conservatorship. You can continue to conduct normal financial transactions like depositing and accessing funds, applying for and paying loans, and using shares. 

What are NCUA’s plans for operations at Telesis Community Credit Union? 

Through a conservatorship, NCUA assumes control of a credit union and seeks to fix identified operating issues. NCUA also continues service to members like you, protects the credit union’s assets, and maintains insurance coverage up to the maximums established in federal law. 

How many branches and members are affected by the conservatorship? 

Headquartered in Chatsworth, Calif., Telesis Community Credit Union has branches in Canyon Valley, Chatsworth, Simi Valley, and Westlake Village. Service to the credit union’s more than 37,600 members continues during the conservatorship. 

What is the field of membership for Telesis Community Credit Union? 

The field of membership for Telesis Community Credit Union includes:

How big is Telesis Community Credit Union? 

The credit union has approximately $318.3 million in assets according to the most recent Call Report (Dec. 31, 2011). 

How long will this conservatorship last?

Member Deposits Protected up to $250,000; Member Service Continues Uninterrupted

ALEXANDRIA, Va. (March 23, 2012) – The Colorado Division of Financial Services appointed the National Credit Union Administration (NCUA) as liquidating agent of Saguache County Credit Union of Moffat, Colo., on March 23, 2012. Immediately following appointment as liquidating agent of Saguache County Credit Union, NCUA entered into an agreement with Aventa Credit Union of Colorado Springs, Colo., to purchase and assume membership shares and certain assets of Saguache County Credit Union.

The accounts of the new members of Aventa Credit Union remain federally insured by the National Credit Union Share Insurance Fund up to $250,000. There will be no interruption in services to the new members of Aventa. Aventa Credit Union is a federally insured, state-chartered credit union with $135 million in assets and 18,100 members.

The Colorado Division of Financial Services made the decision to liquidate Saguache County Credit Union and discontinue its operations after determining the credit union was insolvent with no prospect for restoring viable operations. At the time of liquidation, Saguache County Credit Union served 3,185 members and had assets of approximately $17 million.

Chartered in 1996, Saguache County Credit Union served people living in Saguache County and those who lived in Rio Grande or Alamosa counties and belonged to a cooperative. 

Saguache County Credit Union is the third federally insured credit union liquidation in 2012.

Depósitos de los socios asegurados hasta al menos $250,000; Servicios a los socios continúan sin interrupciones. 

ALEXANDRIA, Va. (23 de Marzo del 2012) – La división de servicios financieros de Colorado nombró a la Administración Nacional de Cooperativas de Ahorro y Crédito (NCUA) como agente de liquidación de la Cooperativa de Ahorro y Crédito Saguache County (Saguache County CU) de Moffat, Colo., el 23 de Marzo del 2012.  Inmediatamente siguiendo la designación de agente de liquidación, la NCUA entró en un acuerdo con la Cooperativa de Ahorro y Crédito Aventa (Aventa CU) de Colorado Springs, Colo., para comprar y asumir el control de las acciones de los socios y ciertos activos de Saguache County CU.

Los depósitos de los nuevos socios de Aventa CU permanecen asegurados federalmente por el Fondo Nacional de Seguro de Depósitos de Cooperativas de Ahorro y Crédito hasta al menos $250,000.  Los nuevos socios de Aventa CU no tendrán interrupción en los servicios.  Aventa CU es una cooperativa de ahorro y crédito con seguro federal y con licencia del estado, que cuenta con $135 millones en activos y 18,100 socios. 

La división de servicios financieros de Colorado tomó la decisión de liquidar Saguache County CU y descontinuar sus operaciones después de determinar que la cooperativa de ahorro y crédito era insolvente sin prospectos viables de restaurar sus operaciones.  Al momento de liquidación, Saguache County CU sirvió a 3,185 socios y tuvo activos de aproximadamente $17 millones.

 
Autorizada en 1996, Saguache County CU sirvió a los residentes del condado de Saguache y a los de los condados de Rio Grande o Alamosa que eran socios de una cooperativa.  

Saguache County CU es la tercera cooperativa de ahorro y crédito asegurada federalmente en ser liquidada en el 2012.

Member Deposits Protected up to $250,000; Consumer Service Hotline Open

ALEXANDRIA, Va. (March 26, 2012) – The National Credit Union Administration (NCUA) today liquidated Shepherd’s Federal Credit Union of Charlotte, N.C. NCUA made the decision to liquidate Shepherd’s Federal Credit Union and discontinue the credit union’s operations after determining the credit union was insolvent and had no prospect for restoring viable operations.

Member deposits at Shepherd’s Federal Credit Union are federally insured by the National Credit Union Share Insurance Fund up to $250,000. NCUA’s Asset Management and Assistance Center will issue checks to members holding verified share accounts in the credit union within one week.

Members of Shepherd’s Federal Credit Union may contact NCUA’s Consumer Assistance Center hotline toll free at 800-755-1030 with any questions. The center answers calls Monday through Friday between 8 a.m. and 6 p.m. Eastern time. Individuals may also visit the MyCreditUnion.gov website at any time for more information on share insurance coverage.

Shepherd’s Federal Credit Union served 1,397 members and had deposits of approximately $379,000. Chartered in 2010, Shepherd’s Federal Credit Union served members and employees of Unity, the Way of Holiness Christian Church in Charlotte and Clarkton, N.C.

Shepherd’s Federal Credit Union is the fourth federally insured credit union liquidation in 2012.

Prohibition Order Results from NCUA Investigation into Unlawful Release of Confidential Examination Records and CAMEL Rating

ALEXANDRIA, Va. (March 28, 2012) – The National Credit Union Administration (NCUA) has issued an order prohibiting the following individual from participating in the affairs of any federally insured financial institution:

• James M. Talbert, a former board and supervisory committee member of District Government Employees Federal Credit Union, Washington, D.C., which does business as DC Federal Credit Union.

The prohibition order results from the unlawful disclosure of DC Federal Credit Union’s confidential examination records and CAMEL rating. Last November, NCUA Board Chairman Debbie Matz asked for a full investigation “to determine which among the parties with access to the confidential examination information, whether NCUA or the credit union’s board or management, took this illegal action.”

After investigating, NCUA determined that Mr. Talbert had breached his fiduciary duties in connection with his position at DC Federal Credit Union by unlawfully disclosing non-public information. Mr. Talbert consented to the issuance of a prohibition order to avoid the time, cost, and expense of administrative litigation.

NCUA enforcement orders are online at http://go.usa.gov/Plq and you may inspect them at NCUA’s Office of General Counsel between 9 a.m. and 4 p.m. Monday through Friday. You may order copies by mail from NCUA, 1775 Duke St., Alexandria, Va. 22314-3428.

Violation of a prohibition order is a felony offense punishable by imprisonment and a fine of up to $1 million.

Board Action Bulletin

The NCUA Board considered a supervisory matters that remain confidential at this time.

The NCUA tweets all open Board meetings live. Follow @TheNCUA (opens new window) on Twitter, and access Board Action Memorandums and NCUA rule changes at www.ncua.gov. The NCUA also live streams, archives and posts videos of open Board meetings online.

Member Deposits Protected up to $250,000; Member Service Continues Uninterrupted

ALEXANDRIA, Va. (May 18, 2012) – The Wisconsin Office of Credit Unions liquidated Wausau Postal Employees Credit Union of Wausau, Wis., today and appointed the National Credit Union Administration (NCUA) as liquidating agent. NCUA immediately signed an agreement with CoVantage Credit Union of Antigo, Wis., to purchase and assume Wausau Postal Employees Credit Union’s assets, liabilities, and membership.

The accounts of the new CoVantage Credit Union members remain federally insured by the National Credit Union Share Insurance Fund up to $250,000. The new CoVantage Credit Union members will experience no interruption in services.

CoVantage Credit Union is a full-service, federally insured, state-chartered credit union with $1 billion in assets and more than 74,000 members. CoVantage Credit Union serves the people who live or work in Wisconsin’s Brown, Clark, Florence, Forest, Langlade, Lincoln, Marathon, Menominee, Oconto, Oneida, Outagamie, Portage, Shawano, Taylor, Waupaca, and Wood counties or in Michigan’s Dickinson and Iron counties.

Wausau Postal Employees Credit Union’s declining financial condition led to its closure and subsequent purchase and assumption. At the time of liquidation, the credit union served 845 members and had $8.4 million in assets.

Chartered in 1932, Wausau Postal Employees Credit Union served all postal and federal employees and their families in the 544 and 545 zip codes. Wausau Postal Employees Credit Union is the fifth federally insured credit union liquidation in 2012.

Board Action Bulletin

The NCUA Board voted unanimously to uphold the decision of the Region V Director and deny an appeal of the Director’s disapproval under Section 701.14 of NCUA’s Rules and Regulations.

The NCUA Board considered four supervisory matters that remain confidential at this time.

The NCUA tweets all open Board meetings live. Follow @TheNCUA (opens new window) on Twitter, and access Board Action Memorandums and NCUA rule changes at www.ncua.gov. The NCUA also live streams, archives and posts videos of open Board meetings online.

Board Action Bulletin

Troubled Debt Restructuring Relief and RegFlex Expansion Pass Unanimously

ALEXANDRIA, Va. (May 24, 2012) – The National Credit Union Administration (NCUA) Board convened its third open meeting of 2012 at the agency’s headquarters here today and unanimously approved three items: 

• A final rule and guidance on troubled debt restructurings (TDRs) to facilitate loan modifications and help distressed credit union members remain in their homes;

• A final rule extending existing Regulatory Flexibility (RegFlex) provisions to all federal credit unions and eliminating the RegFlex designation program; and

• A policy statement removing RegFlex revocations from the list of material supervisory determinations made by the Supervisory Review Committee. 

The Board also received a report on the performance of the National Credit Union Share Insurance Fund (NCUSIF) and the Temporary Corporate Credit Union Stabilization Fund (Stabilization Fund) for the quarter ending March 31. The NCUSIF equity ratio rose by 2 basis points to 1.32 percent during the quarter. The Stabilization Fund’s net position remained steady.

TDR Changes Keep Credit Union Members in Their Homes

Through prudent and sound loan workouts, credit unions can help their financially distressed members to remain in their homes. To help keep even more families in their homes, the Board adopted a final TDR rule (Part 741) and loan workout guidance (Part 741, Appendix C). The changes are designed to ensure that members who can no longer afford to make full payments on their original mortgages can keep their homes, if they agree to certain modified terms with their credit union.

“We listened to credit unions who asked NCUA to provide more flexibility when dealing with financially distressed borrowers and to remove unnecessary regulatory burdens on troubled debt restructurings,” said NCUA Board Chairman Debbie Matz. “We struck a balance and acted quickly to modernize our rules and policies on loan workouts. In response to comments on the proposed rule, our final rule sets no limit on the amount of troubled loans that credit unions can work out with members. And, in addition to benefiting members, these changes provide regulatory relief for credit unions by removing unnecessary manual tracking procedures.”

As a result of the changes approved by the Board, credit unions will now be able to modify loans without having to immediately classify TDRs as delinquent. Specific changes include:

• Requiring federally insured credit unions to adopt and adhere to written policies that govern loan workout arrangements that assist borrowers.

• Allowing credit unions to calculate the past due status of all loans consistent with loan contract terms, including amendments made to loan terms through a formal TDR.

• Eliminating the dual and often manual delinquency tracking burden on credit unions for managing and reporting TDR loans.

• Reaffirming current industry practices by requiring credit unions to discontinue interest accrual on loans past due by 90 days or more and to establish requirements for returning such loans to accrual status.

Modified loans are still very high risks for default as more than 16 percent of outstanding TDRs are delinquent. In approving this rule change, the Board therefore sought to strike a balance between providing more flexibility in loan workouts to help credit union members overcome short-term financial difficulties, while requiring credit unions to charge off non-performing loans that are unlikely to get repaid.

The below chart summarizes the timetable for credit union compliance with the TDR rule changes adopted by the Board:

RegFlex Expanded to Cover All Federal Credit Unions

The Board approved a final rule (Parts 701, 703, 721, 723, and 742) enabling all federal credit unions to engage in activities permitted by the existing RegFlex rules without the need to first apply for a RegFlex designation. By expanding RegFlex, NCUA is complying with the intent of President Obama’s Executive Order 13579 which asked independent agencies to modify, streamline, expand, or repeal regulations to provide relief from unnecessary burdens.

“NCUA has improved the regulatory environment by removing barriers to Regulatory Flexibility provisions for more than 1,700 credit unions,” said Chairman Matz. “By lifting unnecessary restrictions, granting additional powers, and increasing management flexibility, this RegFlex relief expansion advances NCUA’s Regulatory Modernization Initiative and complements the President’s efforts to ease regulatory burdens where appropriate.”

The final RegFlex relief rule closely mirrors the proposed rule and has seven components. These RegFlex relief changes become effective 30 days after publication in the Federal Register.
Specifically, the final rule allows all federal credit unions to: 

• Make charitable contributions to charities of their choosing.

• Accept non-member deposits, up to the greater of 20 percent of shares or $3 million, from local governmental entities or other credit unions.

• Use a six-year time horizon (instead of three years) to partially occupy unimproved property acquired for future expansion.

• Obtain certain exceptions to constraints on purchasing whole loans from other federally insured credit unions.

• Enter into borrowing-repurchase transactions in which the purchased securities have maturities exceeding the maturity of the borrowing-repurchase agreement, provided the investment value does not exceed net worth and subject to certain constraints.

• Purchase private-label commercial mortgage-related securities, subject to certain net worth constraints and safety and soundness investment criteria.

• Invest in zero-coupon securities, subject to certain net worth and investment maturity limits.

The final rule’s preamble includes a summary table to assist readers in distinguishing between the authorities for federal credit unions that meet well-capitalized standards and for federal credit unions that may not. The table furthers NCUA’s efforts to comply with the Plain Writing Act.

When issuing the proposed RegFlex relief rule, NCUA inadvertently omitted changes removing references to RegFlex in the fidelity bond rule (Part 713). The Board therefore issued an interim final rule in conjunction with the final RegFlex rule changes outlined above. The Board encourages all interested individuals or groups to submit comments on the interim final rule within 60 days of publication in the Federal Register so that the Board can consider any amendments at a later date.

RegFlex Dropped from Supervisory Review Committee Duties

The Board issued an Interpretative Ruling and Policy Statement (IRPS 12-1) to change the Guidelines for the Supervisory Review Committee and remove RegFlex revocations from the list of material supervisory determinations federal credit unions can appeal. Because a RegFlex designation is no longer required to earn regulatory flexibility, federal credit unions no longer have a need to appeal. In issuing the policy statement, the Board provided a 30-day comment period. The new guidelines become final 90 days following publication in the Federal Register, unless the Board withdraws the changes within 60 days after publication.

NCUSIF Equity Ratio Rises and Stabilization Fund Remains Steady

The Chief Financial Officer briefed the Board about the performance of the NCUSIF and Stabilization Fund during the first quarter of 2012.

The NCUSIF equity ratio rose to 1.32 percent as of March 31, 2012, up from 1.30 percent three months earlier. This ratio is based on insured shares of $795.3 billion as of Dec. 31, 2011, and includes a net increase of $149 million in credit union contributed capital billed in March 2012. For the first three months of 2012, the NCUSIF had a net income of $18.9 million, with gross income of $54.6 million, operating expenses of $31.8 million, and insurance loss expenses of $3.9 million.

During the first quarter, seven credit unions failed. Three failures were assisted mergers, and four failures were involuntary liquidations of which three were assisted purchase and assumptions. The total year-to-date cost of the seven failures is $5.1 million.

The number, shares, and assets of troubled credit unions continued to decline during the first quarter. As of the end of March, 396 federally insured credit unions had CAMEL code 4 or 5 designations, with assets of $26.7 billion and shares of $23.7 billion. Additionally, 1,662 CAMEL code 3 credit unions had assets of $135.4 billion and shares of $120.3 billion. Overall, 16.3 percent of credit union assets were in CAMEL code 3, 4 or 5 credit unions, down from 17.2 percent three months earlier, but exposure levels are still elevated compared to historical norms.

In the first quarter, the Stabilization Fund’s total net position remained constant at negative $5.2 billion. The Stabilization Fund had a net operating income of $20.8 million for the quarter.

In the first quarter, the Stabilization Fund also received a $278.6 million distribution from the NCUSIF. The Federal Credit Union Act requires NCUA to transfer any NCUSIF equity above the normal operating level of 1.30 percent at year’s end, as long as the Stabilization Fund has an outstanding balance with the U.S. Treasury. The Stabilization Fund continues to have $3.5 billion in such borrowings.

The NCUA tweets all open Board meetings live. Follow @TheNCUA (opens new window) on Twitter, and access Board Action Memorandums and NCUA rule changes at www.ncua.gov. The NCUA also live streams, archives and posts videos of open Board meetings online.

Member Deposits Protected up to $250,000; Member Service Continues Uninterrupted

ALEXANDRIA, Va. (June 1, 2012) – The California Department of Financial Institutions placed Telesis Community Credit Union of Chatsworth, Calif., into liquidation today and appointed the National Credit Union Administration (NCUA) as liquidating agent. Premier America Credit Union of Chatsworth, Calif., immediately purchased and assumed Telesis Community Credit Union’s members, deposits, core facilities, and consumer loans.

The accounts of the new Premier America Credit Union members remain federally insured by the National Credit Union Share Insurance Fund up to $250,000. Administered by NCUA, the fund has the backing of the full faith and credit of the U.S. Government.

The new Premier America Credit Union members will experience no interruption in services. Premier America Credit Union is a federally insured, state-chartered credit union with $1.3 billion in assets and nearly 64,000 members before the purchase.

The California Department of Financial Institutions made the decision to liquidate Telesis Community Credit Union and discontinue its operations after determining the credit union was insolvent and had no prospect for restoring viable operations on its own. At the time of liquidation and subsequent purchase and assumption by Premier America Credit Union, Telesis Community Credit Union served approximately 37,600 members and had $301.3 million in assets.

Originally chartered in 1965, Telesis Community Credit Union’s field of membership at the time of liquidation included, among others, various employer groups and individuals who live, work, worship, or go to school in the San Fernando and Santa Clarita valleys or in Ventura County. Previously, the California Department of Financial Institutions placed Telesis Community Credit Union into conservatorship March 23, 2012.

Telesis Community Credit Union is the sixth federally insured credit union liquidation in 2012.