The U.S. Central-Wescorp crisis that consumed credit union management last week turned into almost a nonevent in the public forum.
Perhaps it was a media saturated with dismal financial news, bank failures, the AIG bailout or President Obama's new housing bailout package, but the NCUA's conservatorship of the two wholesale corporates was mostly overlooked by local media. When it was picked up by the national media, it was not front page news.
Even in Kansas City, where U.S. Central was seized on March 20 after the close of business, next-day coverage of the takeover was coupled with the collapse of a $650 million TeamBank of Paola, Kan., along with the FDIC's sale to another Midwest bank.
While the NCUA's announcement of the conservatorships drew national news coverage the next day, CUNA said its staff along with many state leagues worked Friday night "and through the weekend to ensure our credit unions had information, guidance, talking points and other material in hand so they were informed and could address follow-up inquiries from their members or local media."
There were indeed members with questions, but "from a media standpoint, it has been fairly quiet at least to this point since the initial NCUA announcement, which broke at the same time the FDIC announced three bank failures and the news cycle was dominated by outrage over the AIG bonuses and Treasury's upcoming plan to acquire toxic assets," said Mark Wolff, senior vice president of communications at CUNA.
Still, "things could change," he added. "We want to ensure everyone is well-prepared. The leagues remain in contact with their credit unions, and we at CUNA have continued to meet with officials at NCUA, talk with our key contacts on Capitol Hill, and add new communications resources for our members' use."
At least one corporate, the $4 billion Mid-Atlantic Corporate FCU of Middletown, Pa., became proactive over the weekend, issuing its own press release to Philadelphia and Pittsburgh media, assuring them of the corporate's "conservative approach" and "diversified investment" policies.
"We had a couple of calls, but I don't think many members of the media really understand what a corporate is," said Leigh Phillibosian, senior vice president of Mid-Atlantic. In issuing a statement, a major goal was to inform members about Mid-Atlantic's position, she said.
Michael Wishnow, senior vice president of the Pennsylvania Credit Union Association, praised reporters for doing a good job in distinguishing a corporate from a natural person CU.
The PCUA did field a few media calls but the NCUA takeover simply "fell into the abyss of financial bad news," said Wishnow. Like other leagues, PCUA issued talking point e-mails, informing CUs of developments and to ensure they were not "blindsided" by media calls the following Monday.
"Our most important responsibility is to our members and to make sure they have the information they need as soon as possible," said Rosie Holub, Missouri Credit Union Association president/CEO. "MCUA has plans in place that help us react to news like this and inform our member credit unions, no matter when it occurs."
A spokeswoman for Community America CU in Kansas City said she was taken aback when she read articles in the Kansas City Star pairing TeamBank's failure together with U.S. Central and WesCorp "when they have nothing to do with each other."
Still, the crisis at U.S. Central in Lenexa, Kan., remains top of mind, she said. "Our offices are right across the street from U.S. Central, and we know a lot of their employees," she said.
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