Tuesday, May 23, 2017

Bad Taxi Medallion Loans and New York Credit Union Merger

Credit Union Times is reporting that potential losses from taxi medallion loans played a role in the merger of Northwell Health Federal Credit Union (Jericho, NY) with Bethpage Federal Credit Union (Bethpage, NY).

The Northwell Health Federal Credit Union reported a loss of $2.1 million for 2016, as the credit union increased loan loss provisions for anticipated losses associated with taxi medallion participation loans.

At the end of the first quarter of 2017, Northwell Health had approximately $10.6 million in business participation loans, presumably most of the loans, if not all, were taxi medallion loans. Almost one-third (32.5 percent) of participation loans were 60 days or more past due.

Last year, Bethpage acquired troubled taxi medallion lender Montauk Credit Union.

I suspect that this latest merger will not be the last credit union merger due to taxi medallion loan losses.

Read the Credit Union Times article.

No comments:

Post a Comment


The content is provided for educational purposes only, with the understanding that neither the authors, contributors, nor the publishers of this site are engaged in rendering legal, accounting or other expert or professional services. If legal or other expert assistance is required, the services of a competent professional should be sought.

Comments appearing in response to articles appearing on this site do not necessarily reflect the views of the ABA. ABA makes no representations regarding the truth or accuracy of commentary or opinions that may be posted in response to the articles that appear on this website.

The inclusion herein of any link to a website, either in the text of an article or in a comment, does not denote any approval, sponsorship, or endorsement by the ABA, and ABA is not responsible for the content or opinions expressed on those linked websites or related commentary. This content is not licensed to third parties sites and is not affiliated with any third party site. Any reference to the author or this content on any third party site on the Internet is not authorized by the ABA.

It is the policy of the American Bankers Association to comply fully with all antitrust laws. Certain discussions should be considered off-limits, including those that contain competitively sensitive data such as price and cost information, or statements that could be construed as reflecting an attempt or desire to control or influence a particular market or markets. Future pricing or other prospective competitive information should never be shared.