SAN DIEGO -- USA FCU here charged off $3.6 million in loans and set aside $5.6 million in its reserve for loan and lease losses in the third quarter and reported a net loss of $1 million. Rising delinquencies on loans behind two months and longer were $3.4 million.
To cut costs, the CU recently eliminated 30 positions, more than 10% of its staff.
USA FCU CEO Mary Cunningham said members with subprime loans obtained from other institutions were at the heart of the problem. "Anybody who is in the business of lending money will be impacted by the subprime mortgage meltdown, and that's just a fact," Cunningham said. Resetting mortgages with higher payments are causing members to be late with other debt payments.