NCUA-Conserved AEA Grabs Media Spotlight Again
The problems at NCUA-conserved AEA Federal Credit Union of Yuma, Ariz., continue to garner media coverage, including weekend broadcasts on the local CBS-TV affiliate and stories in the Arizona press, highlighting the CU's $31 million yearend loss and negative 7.63 net worth.
The $309 million AEA, taken over by NCUA in December after its condition worsened amid a kickback scandal involving business loans and grand jury indictments in Phoenix, has been an ongoing woe for NCUA, though there was no word that a purchase/assumption transaction was in the works.
NCUA officials said there is "no change in the status" of AEA following the latest revelations, including $20 million in foreclosures and shrinkage of assets by $109 million over the last year. There were also reports the number of employees has been cut from 160 to100 and that has followed the recent planned departure of the interim CEO, Denise Sweet-McGregor, who held down the top management post in 2010.
One merger analyst, who asked for anonymity, compared NCUA's asset shrinkage of AEA to that of two ailing California High Desert CUs also conserved in 2009. The two small CUs later were merged in a purchase and assumption transaction with Alaska USA FCU of Anchorage, which later acquired more branches from the also conserved Arrowhead Central CU of San Bernardino, Calif.
Following the NCUA takeover of AEA, the number of foreclosed properties has drawn continued media reporting in Yuma, a border town hard hit by the economic downturn. Among commercial properties in Yuma with an AEA link have been a historic Civil War hotel, now closed, and an amusement center called the "Fun Factory."