CHICAGO–Fitch Ratings placed Members United Corporate on Rating Watch Negative late last week, assigning the $13.8 billion credit union a long-term IRD AA- rating. According to a Fitch release, the negative watch reflects a concern the corporate might experience some meaningful losses in its investment book.

"The size of the investment book and the dislocation in the credit markets have contributed to a large unrealized loss position in relation to capital. The investment portfolio is of high quality and continues to pay as agreed to at this point, but does contain meaningful exposure to subprime and Alt-A mortgages," the release stated.

Although Members United has not incurred any losses to date, further erosion in the mortgage market could result in write-downs or impairment charges. The corporate has "ample liquidity" and an overall high quality investment book, Fitch added, but some of its securities are at risk for impairment.