Monday, May 18, 2020

Some CUs Could Be Hit Hard by Coronavirus Layoffs

The Wall Street Journal examined credit unions whose membership have been hit hard by the economic shutdown arising from the coronavirus.

The article noted there are a number of credit unions exposed to casinos, oil, and other industries that have been affected by coronavirus mass layoffs.

According to the Credit Union National Association, almost a third of credit unions are tied to a single employer, industry, or association. This means that these credit unions could see sudden mass layoffs in their membership.

For example, WestStar Credit Union (Las Vegas, NV) is closely tied to the Las Vegas casino industry. On March 18, all casinos were closed by an order from the governor of Nevada. The credit union reported that one in five borrowers have asked for a deferral on a car or home loan.

Provisions for loan and lease losses at WestStar went from $67,300 at the end of the first quarter in 2019 to $553,800 one year later, according to its Financial Performance Report.

Read the story (subscription required).


  1. Which is why it's good for Credit Union's to have a diverse field of membership, moving away from traditional single-sponsor FOM's.

  2. But is this not a result of what the bankers have been seeking? Holding credit unions to a 1930s model while banks have state-of-the-art powers? And don't give me the tax issue. Federal credit unions are the only private enterprises NOT eligible for tax credits on payroll taxes enabled by HR 6201.



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.