Problem Credit Union Update

NCUA reported that the number of problem credit unions increased in August; however, assets and shares (deposits) in problem credit unions fell. A problem credit union is defined as having a CAMEL Code of 4 or 5.

As of August, there were 360 problem credit unions -- an increase of 10 credit unions -- holding $39.5 billion in shares (or 5.26 percent of all credit union insured shares) and $44.8 billion in assets (or 4.95 percent of assets). (click on images to enlarge)





Additionally, NCUA reported that the number of $1 billion plus problem credit unions increased from 13 to 14 in August. These billion-dollar plus credit unions account for almost 48 percent of the shares in problem credit unions.



The percent of assets and shares in problem credit unions has declined over the last couple of months peaking in May at 6.23 percent of shares and 5.75 percent of assets.



However, a troubling sign was the increase in assets and shares in CAMEL 3 credit unions (a CAMEL 3 credit union has some supervisory issues). Shares in CAMEL 3 credit unions rose $9 billion in August to $141.1 billion and assets increased $9.2 billion to $159.3 billion.

Since May 2010, the percent of the industry's assets in CAMEL 3 credit unions have grown by more than 400 basis points from 13.58 percent to 17.62 percent.