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From the July-15, 2009 issue of Credit Union Times Magazine • Subscribe!
Watts United CU Shuttered
The $800,000 Watts United Credit Union was closed and placed into liquidation July 6 by the California Department of Financial Institutions, which had declared it insolvent. The credit union was chartered to serve the residents of Watts in 1966, one year after a series of riots made the Los Angeles neighborhood infamous.
The DFI appointed the NCUA as liquidating agent. The NCUA Asset Management and Assistance Center will issue checks to individuals once they have verified share account balances.
At the time of liquidation, the credit union served 1,067 members. Loan delinquencies and charge-offs were a factor. The combined charge-off and delinquency ratio was as high as 25% as of June 30, 2008, falling to 16% as of March 31. The credit union offered auto loans, signature loans and share-secured loans. Return on average assets was -7% for the first quarter of 2009.
This is the second federally insured credit union to close in 2009, and the first closed this year by the California DFI.
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