Last Friday, the National Credit Union Administration (NCUA) placed Bethex Federal Credit Union into conservatorship.
Bethex FCU is currently holding $502,000 in subordinated debt issued through the TARP's Community Development Capital Initiative.
This $502,000 in subordinated debt represents the majority of the credit union's net worth of $745,570.
Without an injection of new capital, Bethex FCU will probably have difficulty repaying these TARP funds and may default on its TARP obligations.
I suspect that NCUA will engineer a merger of Bethex with another credit union, which would repay the TARP funds.
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