Non-performing taxi medallion loans caused LOMTO Federal Credit Union (Woodside, NY) to post a loss of almost $51.2 million for 2017, after recording a 2016 loss of $18.6 million.
The 2017 loss was due to almost $50.4 million in provision for loan and lease losses. In comparison, provision for loan and lease losses at the end of 2016 was $17.1 million.
As a result of the loss, the $185.5 million credit union's net worth tumbled from $13.7 million at the end of 2016 to minus $37.5 million at the end of 2017. Over the same time period the credit union's net worth ratio fell from 5.79 percent to negative 20.21 percent.
The credit union reported almost $19 million in delinquent loans at the end of 2017 -- down 51.5 percent from the third quarter of 2017. The delinquency rate fell from 21.58 percent to 12.44 percent during the quarter.
Additionally, the credit union is reporting almost $9.8 million in early delinquent loans (30-to-59 days past due).
LOMTO FCU reported net charge-offs of $46.8 million for 2017 -- up from $11.2 million from 2016. The net charge-off rate was 25.44 percent at the end of 2017, up from 4.90 percent at the end of 2016.
Troubled debt restructured commercial loans not secured by real estate were $13.9 million at the end of 2017, of which 52.27 percent were at least 60 days or more past due.
The credit union is reporting allowance for loan and lease losses of $32.2 million at the end of 2017 -- down from $38.2 million at the end of the third quarter of 2017, but up from $25.2 million at the end of 2016. The credit union, as of December 31, 2017, is reporting a coverage ratio (allowance for loan and lease losses divided by delinquent loans) of 169.48 percent.
During the fourth quarter of 2017, LOMTO experienced a 21.5 percent deposit outflow to $160.2 million.
To meet its liquidity needs, LOMTO tapped its lines of credit at one or more corporate credit union. At the end of 2017, LOMTO had borrowed $65 million.
I find it troubling that LOMTO makes no reference to being conserved on the home page of its web site. If you go to the "Latest News" section, the announcement is titled "NCUA Media Release" which is not very transparent. If you go to the Melrose web site, you cannot find any reference to being conserved whatsoever.
ReplyDeleteNCUA is trying to avoid a run.
DeleteThese CUs have borrowed combined over $200M and have uninsured deposits as well.
NCUA
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Dumb on Duke Street. NCUA when will you fire credit union directors and management? When do you issue the Work Prohibition Order? When do you cancel management SERP (Senior Executive Management Payout)? When is enough not enough? How huge must the loss become before liquidation?
Earth to Duke Street: The shark jumped the ship. Consistent losses exceeding 3 years and you leave the lights on this bankrupt group. When will you fire the board? When will you fire the CEO? What is the NCUA?
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Look at the numbers. Can NCUA see a trend? Is it improving? Is it getting worse?
NET INCOME: year end 2015 it is negative (-$13M), year end 2016 it is negative (-18M), year end 2017 it is negative (-$51M). Is the entire Duke Street building completely full of Village Idiots? What part of this do you not comprehend?
NET WORTH: year end 2015: $30M, year end 2016: $11M, year end 2017: minus (-39M). Did the NCUA have a course on negative numbers? Minus net worth is NOT GOOD!
NOTE PAYABLE: year end 2015: $12M, year end 2016: $8M, year end 2017: $65M. What corporate credit union got stuck holding the $65M Note? Can't be WesCorp, MembersUnited or USCentral -those ships sunk already. Recommendation: subcontract audit to professionals like KPMG or any of the other among the top 4. This work is out of the NCUA lane. There are NO Capital Market Specialist, Interest Rate Risk Specialist, Concentratioin Risk Specialist in the building. There are some NCUA Incompetent Specialist. They are doing exam work at LOMTO, PROGRESSIVE, and MELROSE. And the credit unions anticipated a refund. SERIOUS? REALLY? Anticipate this: ASSESSMENT.
Dear credit union members,
ReplyDeleteYou’re really not owners, you’re simply depositors.
Your credit union does not treat you like owners. They hide pertinent information from you such as:
Your taxi credit union is conserved and your uninsured “shares “ are at risk. They’re not telling you because it doesn’t serve their purpose and they don’t care about your purpose.
Your credit union won’t tell you what your ceo is paid if it’s a federal. The reason they won’t do that, despite congressional and GAO suggestion is because it doesn’t serve their purpose even though it could help you hold them more accountable.
This and many other things are not enforced or encouraged by their regulator or trade associations . The reason is because it does not serve their purpose as swine at your trough. they wax on at about member/owners and putting you above where banks would put you...yet...banks offer the same or more services and despite all the cu propaganda enjoy a 80% share of the us market...so they must be doing something right.
Meanwhile credit union associations and regulator push for or cheat to get more bank like powers, while not paying federal income tax.
And your credit union filled the balance sheet with taxi loans (70% of total assets) while the regulator stood by and didn’t regulate.
Now, they won’t tell you they “missed” the opportunity to regulate and have a NEGATIVE EQUITY credit union in conservatorship.
Do you feel like an owner?
Who’s in your wallet?
Here’s who:
Alan (millionaire) Kaufman former ceo of Melrose.
NCUA.
CUNA.
NAFCU.
I have diagnosis of CANCER 4th stage and I submitted my diagnosis to Lomto Fedreal Credit Union my loan defaults from March and my cancer diagnosis in month of March and my chemo start from April 30th 2018. Instead of realizing that I am fighting for my life , I have 2 children older is daughters which is 9 years old and younger one is 6 years old and I have a senior citizen my mother with me 86 years old , my Family was dependent on me and my wife now I cannot work due to aggressive chemo , any one who can help me in the sense moral support . Please
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