DENVER — Despite falling under NCUA conservatorship last April, the $296 million New Horizons Credit Union of Denver remains viable with no plans for a merger, at least through the end of October, according to Colorado Banking Commissioner Chris Myklebust.
"We're very happy about that and we're glad that the NCUA has done its homework," said Myklebust, who helped oversee NCUA's takeover of the state's 10th largest CU when it experienced large loan delinquencies in its construction and subprime portfolio.
Myklebust said he received a report from NCUA recently that has delayed its recommendations on what to do about New Horizons relative to a possible merger until October.
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"Our goal is to return the credit union to its members," said Myklebust. "That's good for the people and for credit unions."
In the takeover, NCUA ousted its president/CEO Tom Gressman, and nine directors who according to the Colorado Department of Regulatory Agencies had "resigned." NCUA installed independent contractors, in this case two Ohio consultants in the top management jobs, a practice common in conservatorships
One of those consultants, Andy Baumann, who is acting CFO, said the CU "is doing quite well" and only experienced a small decline in assets following the state's April 25 "protection" announcement of the NCUA takeover.
Baumann of Columbus, Ohio said he and the installed CEO, Ken Chapman of Cleveland, are not sure, but "we might be staying through the end of the year."
Despite troubles in the Colorado economy earlier this year, Myklebust said he sees no other Colorado CU in similar straits.
"We have our challenges," observed Myklebust listing interest rates, economic conditions "and third-party lenders" as factors impacting CUs.
Taken off the New Horizons' Web site since the NCUA takeover is a mention that the Denver CU membership had been expanded "to include 1,000 employees of Centrix Financial," the Centennial, Colo. subprime auto lender, which in 2005 had its own troubles with NCUA and its Risk Alert on third-party loans. –[email protected]
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