When Jackson Area Federal Credit Union filed its first quarter Call Report a little more than a month ago, it showed a credit union with $143.2 million in assets and a net worth of $13.6 million.
The NCUA conserved the Mississippi credit union May 9, citing unsafe and unsound practices. When the NCUA filed a revised report May 15, it had wiped away $91.7 million in net worth.
The issue wasn't bad loans that had to be written off. It was something else.
It was a something else that fell into the mystery goop category that the NCUA labels as "Miscellaneous Non-Interest Expense." In this case, the NCUA reported $92 million in goop in the income statement, where previously management had reported a mere $29,437.
On the balance sheet, the biggest change was for "Cash On Deposit In Corporate Credit Unions." Jackson Area originally reported $86.2 million; the NCUA found $13.8 million — a $72.5 million downward revision.
The NCUA reduced total gross loans by $1.7 million and total investments by $1.1 million, while adding back assets in other categories. The net result was to cut assets by $71.8 million, showing a credit union that had $71.4 million in assets March 31 — half of what the credit union had previously reported.
On the liabilities side, Jackson Area originally reported $129.4 million in shares and deposits on March 31. The NCUA found $148.2 million — an $18.7 million increase.
CU Times pulled nearly 30 years of NCUA data for Jackson Area from Callahan's Peer Suite. Some of those findings included:
- Jackson Area's loan-to-share ratio peaked at 74.2% and its loan-to-asset ratio peaked at 62.1%, both in December 2007. The ratios were originally reported as 35% loans to shares and 31.7% loans to assets for March 31, but NCUA revisions reduced loans to shares to 29.5% and raised loans to assets to 61.2%.
- From March 2006 through March 2026, the amount Jackson Area reported as deposited with corporate credit unions grew 1.2% per year, while loans grew 0.6% per year and shares grew 0.8%. Members, which had little revision by the NCUA, grew 0.4% per year.
- The revised March report showed non-member deposits made up 28% of total shares and deposits. Non-member deposits first appeared in its Call Reports in September 2023 at 7.5% and have grown since.
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