Defaulting taxi medallion loans continue to wreck the financial performance of Progressive Credit Union (New York, NY).
During the third quarter of 2018, the credit union reported a 9.7 percent decline in its assets to $382.8 million. Year-over-year, assets at the credit union fell by almost 23.7 percent.
Progressive CU posted a loss of $53.3 million for the first three quarters of 2018. During the third quarter of 2018, the credit union posted a loss of $35.3 million.
The credit union increased provision for loan and lease losses during the third quarter of 2018 by almost $26.6 million. As of September 2018, provision for loan and lease losses was $46.8 million.
Due to the third quarter loss, the credit union's net worth fell from $80.5 million as of June 2018 to $44.5 million as of September. Between June and September, the credit union's net worth ratio tumbled from 19 percent to 11.63 percent.
Delinquent loans increased by 14.3 percent during the third quarter to almost $98 million. As of September 30, the credit union's delinquency rate was 24.75 percent.
Also, early delinquencies (30 to 59 days past due) rose by 32.9 percent during the most recent quarter to approximately $15.8 million.
As of September 2018, $39.1 million of commercial loans not secured by real estate, presumably taxi medallion loans, were 60 days or more past due. This means that 13.69 percent of the credit union's $285.8 million in commercial loans not secured by real estate were delinquent.
In addition, the credit union reported $133.2 million in troubled debt restructured non-real estate secured commercial loans, of which $45.3 million were delinquent. This indicates that about 34 percent of these loans were 60 days or more past due.
The credit union recorded as of September 2018 year-to-date net charge-offs of almost $34.4 million. Almost all of the net charge-offs were commercial loans not secured by real estate.
Allowance for loan and lease losses increased by 25.5 percent during the third quarter to $108.5 million at the end of the third quarter. The credit union's coverage ratio (allowance for loan and lease losses to delinquent loans) was 110.75 percent.
Interestingly, the credit union reported a large increase in uninsured non-member deposits compared to a year ago. On September 2018, uninsured non-member deposits were $40.3 million, up from $10 a year earlier.
Furthermore, total non-member deposits were almost $84.6 million as of the most recent call report. Non-member deposits were approximately 32.5 percent of all shares and deposits at Progressive Credit Union.
Progressive is the last remaining major New York City taxi medallion lending credit union. Melrose CU and LOMTO FCU were closed this year by the National Credit Union Administration and Montauk CU was merged into Bethpage FCU in 2016.
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TO: NCUA & OIG
ReplyDeleteRE: PROGRESSIVE FCU
You're FIRED. What are you folks doing on Duke Street? Donuts and coffee? Update: Progressive has gone Regressive. All of this under your watchful eye. All of this under your annual audits and examinations. What do we know? Take a look at your own FPR data. Compare and contrast December, 2014 thru September, 2018. Here are the dismal numbers: Assets are down from $700M to $382M. Where did the money go? Is this called shrinking your way to success? Net Worth is down from $269M to a mere $39M. Where did the Net Worth all $230M go. CEO/CFO $alary, board travel, management junkets? Net Worth has declined from 38% to 11% Can the NCUA see a trend here? Do you need a seeing eye-dog to see this? Delinquency has shot through these taxi's racing like a chased repossession from 2% to 24%. Again take a look at trending. This is a slippery slope. Maybe look at ROA it has dropped from a positive 1.48% to a negative...that is a negative -17.0%. The loan to share ratio has gone from 221% to 152%. Would the NCUA expect a loan to share ratio exceeding 150% should spit back a positive ROA? Visit operating expenses that has gone toxic from 2% to over 7%. Share with us...how bad does this taxi car wreck of rusted beaters with heaters have to get before you shut this place down? The memberships net worth is being raped, pillaged and plundered while the NCUA sits in the back seat eating ding dongs and budgeting for assessments to pay for this NCUA/Progressive FCU cluster mess. While the net worth has left the vault all $230M let's hope management has not had to sustain a cut in pay, salary, benefits. Why punish bad behavior. Hell there still remains $39M in net worth squander. And indeed they will. We are no longer shocked by the inaction of the NCUA - just disappointed.
See today's NYTimes that points out Former CEO Robert Familant made out like a bandit
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