United Resources, the remnants of Western Bridge, is not expected to make it, multiple sources have said.
Sources alleged that Phil Perkins, the CEO of San Dimas, Calif.-based Western Bridge who had been tapped to also serve as CEO of United Resources if it managed to survive, has been acknowledging that the chances of success are slim.
Perkins did not respond to a request for comment.
As of July 19, United Resources said it had raised $22.8 million toward a capital goal of $200 million. Its fundraising deadline of Aug. 31 is looming. As of June, Western Bridge served 885 credit unions.
NCUA, in a statement provided in response to questions from Credit Union Times, denied the reports of failure. Wrote NCUA: “The advisory council for the proposed United Resources Corporate Federal Credit Union continues in its efforts to raise capital. NCUA maintains its position from the beginning of the corporate resolution process that credit unions will be provided an opportunity to implement a member-driven solution.
“The proposed solution involves chartering a new corporate and purchasing and assuming certain assets from Western Bridge Corporate. The business plan calls for the proposed United Resources Corporate to raise a minimum of $200 million in capital through its current capital solicitation.
“Should this capital target not be met, NCUA will need to wind down Western Bridge Corporate’s operations. NCUA will strive to maintain continuity of service while minimizing costs to the Corporate Stabilization Fund.”
Meantime, other experts said there is a scramble afoot in the western states as credit unions that had counted on membership in United Resources going forward are looking for alternatives.
“We are seeing a lot of interest from western credit unions,” said the CEO of one corporate. He claimed he was getting many inquiries from California and Hawaii in particular.
Experts are uncertain exactly what would happen to today’s Western Bridge if the recapitalization drive fails. One option would be that the NCUA would seek to sell assets but to whom and at what price is not presently known.