$8M Life Line Credit Union Seized
The $7.9 million Life Line Credit Union had been struggling financially since 2009, and that apparently led state regulators to close the Richmond, Va.-based cooperative late Friday.
The State Corporation Commission’s Bureau of Financial Institutions in Richmond and the NCUA took control of the credit union at 4 p.m., according to a SCC statement. The NCUA was named the receiver to act as the liquidating agent.
The state regulator decided to discontinue Life Line CU’s operations after determining it was insolvent and had no reasonable prospect of restoring viable operations, according to an NCUA statement.
The $2.5 billion, 232,855-member Virginia Credit Union assumed all share account balances of Life Line CU members, who are now members of the Richmond-based credit union, according to a notice on VCU’s website.
NCUA assumed responsibility for mortgage loans, lines of credit and other loan accounts, VCU said.
Life Line CU’s net worth had been below 7% since 2009, NCUA financial performance reports showed.
In 2009, the credit union’s net worth was 5.55% in 2009, 6.28% in 2010, 6.48% in 2011, 6.01% in 2012 and 5.19% in 2013. At the end of March of this year, Life Line CU’s net worth fell to 4.18%.
What’s more, the credit union’s total loans dropped from $7.9 million in 2009 to $5.2 million in 2013, and its loan income also fell from $522,659 in 2009 to $394,720 in 2013, according to NCUA financial performance reports.
The credit union also posted a net income loss of $69,583 in 2009, but had net income gains of $11,682 in 2010 and $14,647 in 2011. However, in 2012, Life Line CU showed a net income loss of $79,491 in 2012 and another net income loss of $83,033 in 2013, show NCUA financial performance reports.
Chartered in 1969, Life Line CU operated one office in a medical office building of St. Mary’s Hospital in Richmond and employed three people.