LENEXA, Kan. -- Fitch Ratings has changed U.S. Central Federal Credit Union's long-term debt rating of AA+. Previously, U.S. Central was rated AAA with a negative outlook. U.S. Central's short-term rating of F-1+, individual rating of A and support rating of 1 were affirmed by Fitch. The rating actions were prompted by Fitch's assessment of U.S. Central's investment portfolio in light of the prevailing disruption in the global financial markets.
"U.S. Central is a strong, healthy financial institution with $2.4 billion in capital, access to more than $20 billion in available liquidity and a high-quality investment book," commented Francis Lee, president and CEO of U.S. Central. "The AA+ rating underscores U.S. Central's ongoing ability to deliver on our commitment to serve the liquidity needs of the corporate credit union network." Lee went on to say, "The AA+ rating is shared by only three other U.S. depository institutions, and, at a time of considerable uncertainty in the financial markets, we believe this rating from Fitch is an ongoing acknowledgement of the continued strength of our balance sheet and our high liquidity position."
Fitch's release stated "[U.S. Central] continues to exhibit sound credit fundamentals and its franchise remains solid. The company's balance sheet has a low-risk profile, and its funding and liquidity positions remain quite strong." The report went on to say "U.S. Central's investment book is of very high quality, with almost 95% of the portfolio being comprised of AAA-rated securities."
U.S. Central said it applies rigorous internal pre-purchase and on-going reviews of all the assets in its portfolios, which includes stress-testing and analysis of delinquencies and defaults based on current performance data from monthly remittance reports. The CU added that "This level of initial due diligence and detailed ongoing surveillance within its structured securities portfolio gives U.S. Central strong confidence in the assets it holds."
