ARLINGTON, Va.—NCUA has updated its corporate system resolution costs which now show a net projected loss to federally-insured credit unions (FICUs) of $1.7 billion.
NAFCU Chief Economist and Vice President of Research Curt Long noted that the update doesn't materially change the agency's cost projections, but does reflect more certainty in forecasted recoveries.
The updated figures are as of Dec. 31, 2017; the previous projected loss to FICUs was a range of $1.5 billion to $1.9 billion. FICUs paid $4.8 billion in assessments to the Temporary Corporate Credit Union Stabilization Fund (TCCUSF), which was closed and merged with the NCUSIF in September. Based on the current projection, credit unions will be refunded a little more than $3 billion, Long explained.
Long said most of that has already been, or will soon be, realized through the following:
- $735.7 million through distributions later this year
- $1.3 billion retained in the NCUSIF to provide enough equity to reach the previous normal operating level (NOL) level of 1.3%
- $1 billion retained in the NCUSIF to reach the new NOL of 1.39%
"A significant portion of the funds recovered from the corporate resolution process has been retained in the Share Insurance Fund," Long added. "NAFCU continues to urge NCUA to return those funds to credit unions as quickly as possible."
NAFCU's Share Insurance Fund distribution calculator is available for members to download here.
The NCUA also updated the net projected loss to depleted capital holders to an improved range of $3.5 billion to $3.9 billion as a result of legal settlements in 2017. The original depletion of capital claims totaled $5.6 billion. The NCUA figures imply that $1.7 billion to $2.1 billion will be returned to capital holders after the NCUA guaranteed note (NGN) obligations have been repaid in 2021, said Long.