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Resolution

Resolution Actions

The NCUA resolution strategy has three key components:

    1. Isolate and fund legacy assets - Legacy assets will be segregated and managed in an asset management estate. The legacy assets will be securitized. This strategy will result in a lower overall cost of resolution than immediate outright sale of the legacy assets and will also allow the costs of resolution to be funded over ten years rather than immediately. By lowering the overall cost and spreading the assessment period over ten years, the NCUA plan minimizes impact on credit unions and provides adequate time to plan for and adjust to the assessments.

    2. Conservatorship of five critically undercapitalized corporate credit unions – U.S. Central Corporate FCU in Lenexa, KS; Western Corporate FCU in San Dimas, CA; Constitution Corporate FCU in Wallingford, CT; Members United Corporate FCU in Warrenville, IL; and Southwest Corporate FCU in Plano, TX.

    3. Establishment of bridge corporate credit unions to conduct essential activities of the conserved corporate credit unions with no interruption in member services, particularly facilitating payment and settlement services.

 

Deposits remain insured or guaranteed and the resolution plan is designed to assure no loss to taxpayers.

In the table below, click on the links to read about actions to address legacy assets within the corporate credit union system including the legacy assets isolation and funding strategy, corporate conservatorships, and bridge corporates.


THESE DOCUMENTS ARE BEING PROVIDED FOR INFORMATION PURPOSES ONLY, AND DO NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION OF AN OFFER TO BUY, SECURITIES. THEY DO NOT PURPORT TO BE ALL-INCLUSIVE OR TO CONTAIN ALL OF THE INFORMATION THAT A PROSPECTIVE INVESTOR MAY REQUIRE TO MAKE A FULL ANALYSIS OF THE SECURITIES TRANSACTIONS REFERENCED HEREIN. THE INFORMATION CONTAINED HEREIN REGARDING SECURITIES TRANSACTIONS WILL BE SUPERSEDED, AND IS QUALIFIED IN ITS ENTIRETY, BY INFORMATION CONTAINED IN THE DEFINITIVE OFFERING DOCUMENTS FOR THE SECURITIES TRANSACTIONS. OFFERS OF SECURITIES WILL BE MADE ONLY THROUGH THE DELIVERY OF DEFINITIVE OFFERING DOCUMENTS FOR THE SECURITIES TRANSACTIONS AND IN ACCORDANCE WITH APPLICABLE SECURITIES LAWS.


Document Number Title Description of Contents
CSR-3 Glossary of Terms A glossary of terms used in corporate system resolution documents.
CSR-10 Letter to Credit Unions: Legacy Assets
10-CU-19
Letter to Credit Unions: Resolution strategy for isolation and funding legacy assets including regulatory reform.
CSR-11 Fact Sheet: Isolation and Funding Reference information on legacy assets.
CSR-12 Frequently Asked Questions: Isolation and Funding The specifics of the isolation and funding of the legacy assets including the “Good Bank/Bad Bank” process and the anticipated timeline for events; Specific characteristics of the guaranteed notes are outlined; Who is assisting NCUA with the securitization of legacy assets; How much the process is going to cost.
CSR-13 Letter to Credit Unions: Investment Due Diligence
10-CU-18
Letter to Credit Unions: Effective risk management of investments.
CSR-14 Fact Sheet: Corporate Credit Union Conservatorships The actions taken and relevant details regarding the conserved corporate actions of September 24, 2010.
CSR-15 Frequently Asked Questions: Conservatorships Questions and answers regarding conservatorship actions of September 24, 2010.
CSR-16 Fact Sheet: Bridge Corporate Credit Unions This document outlines the general operations of the bridge corporates, their purpose, as well as the planned balance sheet structure.
CSR-17 Frequently Asked Questions: Bridge Corporates Questions and answers regarding bridge corporate operations and governance.
CSR-18 Filing a Proof of Claim Graphic Instructions for filing a proof of claim for all claims other than an “error in accounting estimate”. Conserved corporate members will automatically receive a claim receipt from NCUA for claims based on an “error in accounting estimate”.
CSR-30 NCUA Guaranteed Notes Contact Information Contact information and instructions for investors.
CSR-35 NCUA Guaranteed Notes Assigned 0 Percent Risk Weight An October 2010 interagency letter from federal banking regulators indicating a 0% risk weight assignment for the NCUA Guaranteed Notes.
CSR-39 NCUA Guaranteed Notes 0 Percent Risk Weight Supplement An November 2010 interagency letter from federal banking regulators clarifying the 0% risk weight assignment for the NCUA Guaranteed Notes.
CSR-38 Fact Sheet: NCUA Guaranteed Notes (NGNs) An overview of the NGNs which addresses their permissibility as an investment for credit unions.