Members may have heard or read about the National Credit Union Administration (NCUA) seizing three corporate credit unions on Friday, September 24th. Corporate credit unions are basically credit unions for natural person credit unions. North Alabama Educators Credit Union is a member of two corporate credit unions, none of which was seized in the NCUA action this past week. The NCUA conducted a 2-hour webinar on Monday, September 27th to explain the actions and the future impact on other credit unions throughout the country. All credit unions that are federally insured will help fund the insurance fund over a period of several years. The term "bailout" has been incorrectly used in describing the actions of the NCUA in dealing with the corporate credit unions. No taxpayer money is being used. All federally insured credit unions, including North Alabama Educators Credit Union, have sufficient reserves on hand to fund industry losses without the need for taxpayer money.
The Wall Street Journal has a good article on this subject, other than the fact that they also use the word "bailout" in the article header. It is not a bailout. Read the article for an overview of the situation. LINK HERE.
