After several quarters of subpar results, the NCUA last week liquidated the $139 million Southwest Community FCU of St. George, Utah, and announced that its assets and liabilities would be purchased and assumed by Chartway FCU.
As of March 31, Southwest Community FCU's net worth ratio was 3.18%, down from 3.70% as of Dec. 31.
Its delinquent loan ratio was 6.33% at the end of the first quarter, following a 7.03% ratio at the end of last year. It has had a negative return on average assets during the last five quarters, most recently, 2% at the end of March.
"We have tremendous respect for Chartway and are excited by the opportunities this partnership offers," said Southwest Community President/CEO Muriel Blake. "Not only will we benefit immediately from their strong financial foundation, but we will be able to offer the products and services needed to maintain a competitive edge in this progressive environment."
Chartway FCU CEO Ron Burniske said the partnership will ease the ongoing market stress Southwest has endured as a result of the economic downturn.
"As our nation's citizens have struggled to stay afloat, so have financial institutions because what happens to those on Main Street in turn happens to their banks and credit unions," he said.
Southwest Community FCU, which was founded in 1937 and served 19,041 members, is the 10th credit union the NCUA has liquidated this year.
--cmarx@cutimes.com
