SELMA, Ala.—Massive losses from poor performing loans have pushed conserved Riverdale Credit Union here deeper into insolvency as of September 2017.
The credit union posted a year-to-date loss of $14.3 million, driven by provision for loan and lease losses of $15.6 million through the first three quarters of 2017. As a result of the loss, the credit union's net worth has dropped from almost $8.9 million to a negative $6.1 million, reported Keith Leggett, the former senior vice president and senior economist at the ABA, on his Credit Union Watch Blog.
The credit union's net worth ratio fell from 12.21% as of the end of 2016 to minus 11.05% as of September 2017. Delinquent loans rose from $1.6 million at the end of 2016 to $7.1 million at the end of the third quarter 2017. The delinquency rate as of September 2017 was 14.33%, Leggett said.
As of September 2017, net charge-offs were $12.8 million. The net charge-off rate was 30.61% as of the most recent call report. Total assets of the credit union have dropped by almost 25% from the start of this year to $54.9 million as of the most recent call report. However, the credit union's assets are now less than its total deposits and shares of $57 million, Leggett reported.