Bridge Charter Preserves Recapitalization Choice
NCUA's plan to issue bridge charters for seized corporates was crafted to allow all member credit unions to choose whether they want to be part of recapitalization.
"The leaders of the nation's consumer credit unions must make the hard business decisions about whether to recapitalize a corporate, to switch to a different corporate, or to seek services at some other type of institution," said NCUA Chairman Debbie Matz. "These decisions are the industry's to make, and NCUA is confident that the new framework will enable the choices ahead to be made in the context of strong and safe credit union operations."
NCUA Deputy Executive Director Larry Fazio added the bridge charter will preserve corporates for those who wish to recapitalize. Credit unions that apply for a new corporate charter could transfer surviving operations to the "new" corporate through purchase and assumption.
"We're trying to be fair to credit unions that don't want to recapitalize, and to those that do," he said.