New corporates will assume existing business, ensure continuity
November 8, 2010, Alexandria, Va. – The National Credit Union Administration today announced the creation of two new bridge corporate credit unions assuming the operations of Members United Corporate of Warrenville, Ill., and Southwest Corporate of Plano, Texas.
These actions, which were originally announced in conjunction with the unveiling of NCUA’s Corporate System Resolution Plan on September 24, comprise the next phase in transition of corporate credit unions currently under NCUA conservatorship.
The newly created institutions will be known as Members United Bridge Corporate Federal Credit Union and Southwest Bridge Corporate Federal Credit Union.
NCUA has implemented a “Good Bank/Bad Bank” model to facilitate the corporate resolution process. Bridge corporate credit unions (“good banks”) are chartered by the NCUA Board to purchase and assume “good” assets and member share deposits from the conserved corporate credit unions (“bad banks”). Bridge corporate credit unions will be highly liquid and operated to ensure stability and minimize disruption of service to member credit unions.
Other bridge corporate operational highlights include:
NCUA is committed to operating bridge corporates in a way that minimizes disruption of services provided to members. However, the bridge corporate cannot operate indefinitely. Bridge leadership will consult with members to develop a viable long-term plan that would enable the delivery of services transferring the bridge corporate’s operations to a newly chartered corporate credit union, or selling operations to another entity capable of providing uninterrupted services.
Should a bridge corporate’s members decide not to support the plan or another entity not be identified, NCUA is committed to operating the bridge corporate for sufficient time so that members can find individual solutions. This process could take up to 24 months.
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