From unfunded commitments and unsecured revolving lines of credit, several of Telesis Community Credit Union member business loan categories have been in a free-fall since at least 2010.
Late Friday, the NCUA was appointed the conservator of the $318 million, Chatsworth, Calif.-based Telesis after the California Department of Financial Institutions placed the credit union in conservatorship due to declining financial conditions.
A scan through Telesis’ December 2011 NCUA Call Report, the latest on record, revealed a number of areas in the negative territory.
From December 2010 to December 2011, Telesis went from nearly $202 million in MBLs to $152.6 million at the end of last year. Unfunded commitments also dropped significantly during the same period going from $1.1 million to $314,000.
In the non-real estate secured loans to members and nonmembers, Telesis experienced several hits to its portfolio over a nine-month period. The credit union had $5.6 million in commercial and industrial loans in March 2011 and $4.1 million in December 2011. Unsecured business loans plummeted to $966,505 at the end of last year from nearly $1.6 million in March 2011.
Member business loans that were delinquent for one year or more continued to increase from December 2010 to December 2011 going from $5.2 million to nearly $18 million. For the same period, loans that were delinquent for six to 12 months were not as high at $12.4 million in December 2010, dropping to $3.8 million in December 2011.
At the end of last year, Telesis had $144 million in participation loans outstanding, down from $176 million in December 2010. The credit union sold $29 million in participation loans at the end of last year.
Telesis made its entry into business lending as Telesis Partnerships LLC. In 1995, it became Business Partners LLC, a CUSO that was originally owned by more than a dozen credit unions nationwide. At its peak, Business Partners served more than 180 credit unions.
As recent as January 2011, Business Partners had formed BP Connect, a loan participation network to connect buyers and sellers.
Credit Union Times has not received a call back from Business Partners, Telesis or the NCUA.