SACRAMENTO — Nearly one-third of all California based credit unions had negative ROA during the 1st quarter 2008, according to statistics from The Watch Report, a credit union data service from Forest Grove, Ore.-based Bartoo Associates. That number, 32.59%, has more than doubled from 1st quarter 2007, when only 15.80% failed to turn a profit.
Negative ROA has increased nationwide, with nearly 20% of all credit unions reporting ROA in the red last quarter. However, California financial institutions are fairing far worse: 30.03% of California-based banks reported negative ROA during 1st quarter 2008, up from 5.84% same period last year.
What's to blame? California Credit Union League economist Terrin Griffiths said she's heard credit unions are circling the wagons and taking large loan loss provisions during the 1st quarter, rather than parceling them out over time.
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