ALEXANDRIA, Va. - According to Bob Schafer, director of the office of corporate credit unions for NCUA, looking at the year-end 1999 stats, one thing is clear, the corporate network is extremely healthy.
"I think the thing that was most significant was the increase in capital. Corporates had good bottomlines last year. Despite the fact that they were implementing 704 and had Y2K expenditures, capital was strong. To their credit, a number of corporates did go out and solicit paid in capital from their members," said Schafer.
Schafer said the corporate system, excluding U.S. Central, is looking at a 4.4% reserve ratio, which is very health.
"There were a lot more investments in the corporate system, up to 27 to 29% of credit union assets. Credit unions were looking for short-term investments because of Y2K. The investments will begin to roll out into longer term investments but it might take a little longer because credit unions still aren't sure where interest rates are going."
Schafer said he is seeing increased efforts by corporates to keep investments in the system, whether it's by directing corporates to a corporate owned broker/dealers such as Corporate Brokerage Network Service, or by rolling out their own broker/dealer.
Below is a look at year-end `99 corporate data provided by CUNA. -pgentile@cutimes.com
