This marked the fourth credit union liquidation since April.

Although AFCU, which served 811 members, did not post any bottom line losses, its financial performance and Call Reports showed the credit union was struggling. Indicators included inadequate liquidity, a lack of diversified income and asset base, high-risk loan concentrations without appropriate provisioning or CECL implementation, and unrealistically low or absent loan losses, suggesting poor risk oversight or financial reporting.

The credit union’s cash and short-term investment assets was only 2.49% at the end of March versus the peer average of nearly 29%, which signals severe liquidity issues.

Additionally, loans consistently exceeded 97% of total assets, nearly double the peer average of 50%, according to NCUA reports.

Although loan growth was steady, it outpaced share growth, resulting in a loan-to-share ratio of 110% at the end of 2025 and 109% by the end of the first quarter, substantially higher than the peer average of nearly 60%.

Of the credit union’s 673 total loans that amounted to $10.3 million, 573 were unsecured lines of credit, which totaled $8.4 million, or 82% of the loan portfolio, according to AFCU’s first-quarter Call Report.

The credit union reported zero charge-offs or delinquent loans over five years. Its allowance for loan and lease losses remained unchanged at $85,250 from 2020 to 2025, despite loan growth from $6.2 million to $10.3 million over the same period.

However, AFCU’s Call Report for December 2024 showed $258,611 in 30- to 59-day delinquencies from line-of-credit and auto loans, though it did not disclose the number of loans. The report did not indicate any other delinquencies or charge-offs. The first quarter 2025 Call Report showed $119,853 in 30- to 59-day delinquencies from the same loan types, again without listing the number of loans, and reported no other delinquencies or charge-offs.

Peter Strozniak can be reached at [email protected].