BRIARWOOD, N.Y.—Another New York City credit union has been conserved due to the impact of ride sharing on the taxi industry here.
The New York State Department of Financial Services Friday took possession of the $1.8-billion Melrose Credit Union, and appointed the National Credit Union Administration as conservator.
Taxi medallion lender Montauk CU was conserved in September of 2015 and was later merged into Bethpage FCU.
A release from NCUA stated that the New York State Department of Financial Services placed Melrose into conservatorship because of “unsafe and unsound practices at the credit union.”
As CUToday.info reported, in August, Melrose Credit Union was issued a consent order by the New York State Department of Financial Services following a joint safety and soundness exam conducted by the Department and NCUA. In July, CEO, Alan Kaufman, departed Melrose, leaving Steven Krauser as acting CEO.
Melrose, very well capitalized only a few years ago—20.22% in 2013—saw that cushion slip away quickly as taxi medallion loan delinquencies increased as medallion values plummeted. By the close of 2016, capital at Melrose stood at 5.73%