Number of Problem Credit Unions Increase in June, But Assets and Shares Fell

NCUA reported today that the number of problem credit unions increased by 15 in June to 366; however, assets and shares in problem credit unions fell during the month. A problem credit union is defined as a credit union with a CAMEL rating of 4 or 5. (click to enlarge images)







NCUA reported that shares in problem credit unions fell by $2.3 billion to $43 billion and assets fell from $51.6 billion in May to $48.8 billion in June. According to NCUA, 5.69 percent of the credit union industry's insured shares (deposits) and 5.30 percent of the industry's assets are in problem credit unions.







NCUA reported that the number of $1 billion plus problem credit unions declined by 1 to 14 during June. Total shares in billion-dollar plus problem credit unions fell from $23.4 billion in May to $21.5 billion in June.

There was no change in the number of problem credit unions with between $500 million and $1 billion in assets at 10. However, there was one less problem credit union with between $100 million and $500 million in assets, bringing the total to 54.

An additional 17 credit unions with less than $100 million in assets was added to the problem list.

NCUA also reported an increase in the number of credit unions with a CAMEL 3 ratings, which indicates some degree of supervisory concern. Credit unions with a CAMEL 3 rating stood at 1,739 as of June -- an increase of 15 credit unions. But there was a significant increase in assets and shares in CAMEL 3 credit unions with assets increasing from $121.9 billion in May to $149.8 billion in June and shares from $105.9 billion to $131.9 billion.

As the following chart shows, most of the increase in shares in CAMEL 3 rated credit unions arose from 4 credit unions with over $1 billion in assets receiving a CAMEL 3 rating. One of the four billion-dollar plus credit union saw an improvement in its CAMEL rating from a 4 or 5 to a 3.