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Members United meets on franchise value service plans
WARRENVILLE, Ill. (10/4/10)--Members United Corporate FCU hosted a webinar Friday morning to update members on the state of the corporate since it was placed into conservatorship. In the webinar, the leadership noted that all shares are insured through Dec. 31, 2012, all products and services are in place with no interruptions, and the corporate will deliver a new plan for its survival to members later this month, according to the New Jersey Credit Union League (The Daily Exchange Oct. 1). The corporate was one of three placed into conservatorship on Sept. 24 by the National Credit Union Administration (NCUA). Scott Hunt of NCUA's Office of Corporate Credit Unions and now a board member of the corporate told members there is value in the Members United "franchise" and he hoped members would be open to listening to Members United's plan for the future. "The benefit of Members United and the other corporates is a franchise value," he told those attending the webinar. Members United serves 2,400 members out of the 7,600 credit unions in the system, a "significant" number, he said. NCUA encouraged members to consider a long-term, viable partner as a group. The corporate will have time to consider a plan. If a viable plan isn't found, members would then have about 24 months to find a future provider. However, Hunt said NCUA would be flexible on the timing. "It will be much more difficult for members if we piece out services to other providers. The first goal is to remain intact all the solutions provided to members by Members United," he said. Interim CEO Chuck Furbee emphasized that a bridge corporate "means we look different from an accounting perspective, but we look very much the same from an operations standpoint." For the next six months it is better for the entire corporate credit union system if credit unions keep their funds in the corporate while NCUA works on implementing the legacy asset strategy, Hunt said. Credit unions asked if those who lost member capital shares will have an opportunity to recoup the funds if the "legacy assets" perform better than expected. However, Hunt noted that the funds' priority will be to settle the corporate's liability and the returns likely would not be cleared for up to 20 years. "The amount and timing are very much unknown. I don't want to give any false perception that will happen, but we are preserving that opportunity." A recording of the one-hour webinar is available at Members United Corporate's website. To access it, use the link.
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