The National Credit Union Administration announced that Montauk Credit Union of New York, New York, has been merged into Bethpage Federal Credit Union of Bethpage, New York.
On September 18, 2015, the New York State Department of Financial Services placed Montauk into conservatorship and appointed the National Credit Union Administration as conservator. The credit union was critically undercapitalized as of the end of 2015. Click here to read my analysis of Montauk's performance at the end of 2015.
Montauk had assets of $162 million and 2,830 members, according to its most recent Call Report.
Bethpage FCU had assets of $6.2 billion at the end of 2015.
It appears that Bethpage FCU has taken a bullet for the credit union industry in order to keep the National Credit Union Share Insurance Fund from recognizing losses associated with problem taxi medallion loans at Montauk.
In my opinion, doing this merger without NCUA assistance is insane and not in the best interest of Bethpage's members.
Read the press release.
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