U.S. Central Releases 3rd Qtr. Financials
October 30, 2009
Dear Members:
U.S. Central Federal Credit Union (U.S. Central) released their Third Quarter Financial Report today, announcing a $308.5 million net loss for the third quarter, primarily attributed to third quarter other-than-temporary impairment (OTTI) charges of $320.1 million on its portfolio. While these numbers are disappointing, they are not altogether unexpected. As we have been communicating to you through our own financial reports, updates and town hall meetings, our remaining capital exposure to U.S. Central, prior to the release of this latest report, was $15.1 million. But Corporate One now will be required to write down $10.4 million of that to cover these latest losses. However, our capital position remains strong. Our Reserves and Undivided Earnings (RUDE) at Sept. 30, 2009 (unaudited) was $66.5 million. With a write-down of $10.4 million, Corporate One still has $56.1 million of RUDE to protect our members’ membership capital (MCS and PIC). This write-down of U.S. Central capital will not require an impairment of membership capital that our members hold with Corporate One.
With the recent write-down of our U.S. Central capital, Corporate One now has $4.7 million dollars remaining of U.S. Central membership capital. With our current RUDE position, and even with additional OTTI charges that we may need to take on our own portfolio, Corporate One still believes that all membership capital placed with us will remain intact.
Should you have questions related to the release of the U.S. Central Third Quarter Financial Report, or about Corporate One’s financials, please don’t hesitate to contact our VP, CFO, Melissa Ashley at 866/MyCorp1, ext. 9351 or mashley@corporateone.coop. Or, you may contact me directly. As a reminder, our 2008 audited financials and monthly financial reports can be found on our website at http://www.corporateone.coop/www/DueDiligence.asp.
Respectfully,
Lee C. Butke
President/CEO
866/MyCorp1, ext. 9300
lbutke@corporateone.coop
