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.
NCUA today announced the Temporary Corporate Credit Union Stabilization Fund has been extended to June 30, 2021, with the concurrence of Treasury Secretary Timothy F. Geithner.
New securities issued from legacy assets will be guaranteed by NCUA, said Deputy Executive Director Larry Fazio.
NCUA's final corporate rules simplified limitations on permissible investments for wholesale credit unions.
Credit unions will be allowed to purchase securitized legacy assets, said NCUA Deputy Executive Director Larry Fazio.
NCUA will transfer the legacy assets from five seized corporates into a trust, and securitize them for investors from there.
NCUA today placed three corporate credit unions into conservatorship: the $7.4 billion Members United Corporate FCU, the $9.5 billion Southwest Corporate FCU and the $1.2 billion Constitution Corporate FCU.
NCUA's legacy assets plan will create a "good bank, bad bank" structure similar to a strategy previously utilized by FDIC.
NCUA will propose a second round of corporate rules, releasing the items for comment as early as November, said Deputy Executive Director Larry Fazio.
NCUA's sale of $800 million worth of U.S. Central FCU and Western Corporate FCU securities announced yesterday wasn't part of the regulator's legacy assets plan.