Fueled by the failures of six credit unions this year, the NCUA’s Share Insurance Fund reserves had dropped $744.9 million by the end of the year’s 3rd Quarter, agency officials said Thursday.
Despite repeated requests for a further explanation of how those losses occurred, NCUA officials did not elaborate on the announcement, which was made at Thursday’s agency board meeting.
However, an examination of the credit union closures for this year centers on two potentially being the largest sources for the drain—Melrose Credit Union and LOMTO Federal Credit Union.
Both of those institutions faced millions of dollars in losses for loans made with taxi medallions as collateral. As rider-sharing services have gained in popularity, the value of those medallions has plunged.
Teachers Federal Credit Union took over both of those credit unions but did not take on any of the taxi-related loans, leaving those likely bad loans in the hands of the NCUA.
And so far, agency officials have refused to provide the number of loans the agency has assumed or their total amounts.
The NCUA’s Office of Inspector General must conduct “Material Loss Reviews” for any credit union that causes a drain of at least $25 million to the Share Insurance Fund. However, the office has not yet released reports on any of the six.