Number of Problem CUs Fell in Q4, But Assets and Shares Increased in Problem CUs

The number of problem credit unions fell during the fourth quarter of 2018, according to the National Credit Union Administration (NCUA).

At the end of the fourth quarter of 2018, there were 193 problem credit unions. In comparison, there were 203 problem credit unions at the end of the third quarter of 2018.

A problem credit union has a composite CAMEL rating of 4 or 5.

Total assets and shares (deposits) in problem credit unions rose during the fourth quarter. Assets in problem credit unions were $11.8 billion at the end of 2018 compared to $11.5 billion at the end of the third quarter of 2018. Shares in problem credit unions were $10.6 billion as of December 2018 versus $10.4 billion as of September 30, 2018.

The number of problem credit unions with less than $100 million fell by 14 to 165 during the fourth quarter. But the number of problem credit unions with between $100 million in assets and $500 million in assets increased by 4 to 25 during the quarter.

NCUA reported that 85.5 percent of problem credit unions have less than $100 million in assets, while slightly more than 2 percent of problem credit unions have more than $500 million in assets.

At the end of the fourth quarter, 0.93 percent of total insured shares were in problem credit unions. This was up 2 basis points from September 2018.

In related note, for all of 2018 charges for liquidations and assisted mergers were $752.9 million and $39.6 million, respectively. NCUA recorded a charge of $39.5 million associated with assisted mergers in the fourth quarter. This is probably associated with the merger of Bay Ridge FCU (Brooklyn, NY) into Island Federal Credit Union (Hauppauge, NY).