With Friday's failure of Cumorah Credit Union as a talking point, the head of the industry's primary private insurer expressed new confidence Monday in the health of the private system maintaining that "all the right moves" were made in the out-of-state Nevada takeover.
"Our other Nevada credit unions are simply working much harder these days in the face of these very difficult challenges but by selecting a healthy Midwest credit union, we've created a more diversified and favorable climate for Cumorah's future," said Dennis Adams, president/CEO of American Mutual Share Insurance of Dublin, Ohio, the underwriter for Cumorah and six other Nevada CUs, including several of the largest.
Adams was referring to the purchase/assumption deal arranged with state regulators for the buyout of the $147 million Cumorah by the $575 million Credit Union 1 of Rantoul, Ill. ASI staffers had been "on-site" at Cumorah for weeks, ever since rumors circulated the CU was on the brink of collapse following faulty real estate loans.
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Other privately insured CUs in the state, although undergoing delinquencies and loan writeoffs, are "handling the problems well" and he dismissed any notion that more failures of privately insured Nevada CUs are in the offing.
Cumorah was a case "of one of our credit unions that didn't make it but we have a strong, healthy, responsible credit union to correct the situation."
Other Nevada CUs "are simply working smarter," observed Adams adding the private insurance system remains in sound financial shape. "This was first paid out claim since 2006," he noted.
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