LENEXA, Kansas -- U.S. Central Credit Union informed its members recently about $20 million in investment-related losses appearing on its July 31, 2007 financial statement.

U.S. Central attributed $3.5 million of the losses to normal business. The remaining $16.5 million loss was due to spread widening in a portfolio of primarily fixed-rate, AAA-rated commercial mortgage-backed securities.

U.S. Central said in a letter to owners that the problems in the subprime arena were not the cause of this loss. "While excessive liquidity has fueled easier financing of most asset classes, the CMBS sector has not experienced the problems now seen in the subprime residential mortgage sector," the letter stated.

A snapshot of U.S.Central's assets by class as of June 30, 2007 shows 11.5% is in subprime residential mortgage backed securities. All other residential mortgage backed securities account for a much bigger percentage at 32.1%. Commercial mortgage backed securities account for just 2.8%.

U.S. Central said the loss will not affect product pricing and will be recovered when spreads tighten. U.S. Central expects Net Increase to Retained Earnings for 2007 to be in the $38 to $46.5 million range, consistent with the last three years.