After posting a profit for the first quarter of 2018, taxi medallion lender Progressive Credit Union (New York, NY) reported a mid-year loss of almost $18 million. For the second quarter, the credit union recorded a loss of $$22.28 million. The loss was due to an increase in provision for loan and lease losses from $3.16 million as of March 2018 to $20.28 million as of June 2018.
Due to the second quarter loss, the credit union's net worth tumbled by 21.1 percent during the quarter to $80.5 million. The credit union's net worth ratio fell to 19 percent as of June 2018 from 21.92 percent at the end of the first quarter 2018.
Assets at Progressive Credit Union fell by 9 percent during the second quarter of 2018 to $423.8 million. A year earlier assets were $511.5 million.
During the quarter delinquent loans edged higher by 1.4 percent during the quarter to $85.7 million. The credit union's delinquency rate rose from 19.55 percent on March 31, 2018 to 21.18 percent on June 30, 2018.
Troubled debt restructured (TDR) commercial loans were $133.2 million at the end of June 2018. The credit union reported that 30.1 percent of its TDR commercial loans were 60 days or more past due.
The credit union reported a surge in net charge-offs from $7.26 million as of March to $28.89 million as of June 2018. At the end of the second quarter, the net charge-off rate was 13.59 percent.
Progressive Credit Union reported a 6 percent decline in its allowance for loan and lease losses balances to $86.5 million, as net charge-offs grew faster than provision for loan and lease losses. The credit union's coverage ratio was 100.89 percent as of June 2018.
The credit union has a buffer to absorb expected and unexpected losses of almost $167 million.
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What did the NCUA know and when did it know it? The NCUA knew these taxi credit unions were bankrupt and losses would be huge. The NCUSIF had to be massively funded to absorb the losses. This explains why the NCUA in December, 2017 funded the loan loss provision reserves $750M. Previously it was a mere $225M. In one month the account grew over $940M. Boggles the mind what the potential threat of a year end audit can do to a grossly incompetent pseudo-federal agency. An agency without ethics or a moral compass. An agency accountable to no one. Private Share Insurance through American Share Insurance (Ohio) is quite attractive with a better price point. Escape future assessments move to ASI. Staying on the NCUA federal charter is a waste of credit union assets. Pay dividends to your members, not assessments to the NCUA.
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