ALEXANDRIA, Va. (10/24/14)--National Credit Union Administration staff confirmed earlier indications that there will be no National Credit Union Share Insurance Fund premium for 2014 at the agency's monthly board meeting Thursday. Credit Union National Association analysis earlier this year also concluded that given the health of the credit union system, a premium would not be required.
The fund ended the third quarter of 2014 with a net income of $24.6 million and an equity ratio of 1.3%, which reflects the capitalization deposit adjustment billed in September. Third quarter investment and other income was $54 million, operating expenses were $48.1 million and the provision for insurance losses was reduced by $18.7 million, according to the agency.
The fund's reserves are at approximately $167.3 million.
Shares in CAMEL 4 and 5 credit unions were 1.38% of federally insured credit union shares, an improvement over last quarter's 1.46%. The number of CAMEL 4 and 5 credit unions fell to 288 from the third quarter of last year, a 9.1% drop. Assets for those credit unions declined 10.3% in the past year.
|A chart showing the percent of CAMEL 4 and 5 credit union shares and how they have dropped over the past several years. Source: NCUA|
The number of CAMEL 3 credit unions dropped to 1,450, a 2.2% decline, and with that decline, total assets in CAMEL 3 credit unions dropped 3.4% to $104.7 billion.
According to NCUA staff, there was been 12 credit union failures this year. There were 17 in 2013. Total year-to-date losses due to credit union failures is $30.4 million, $28.6 million of which was related to fraud.
During the report, board member J. Mark McWatters questioned staff about the nature of losses and expenses to the NCUSIF. When staff indicated that they are mostly due to fraud, McWatters raised concerns about the overwhelming emphasis on regulation when a substantial percentage of the losses to the SIF are caused by garden variety fraud that should be addressed in a more aggressive manner by NCUA.