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Wis. regulator holds quarterly report til law passes
MILWAUKEE (5/28/09)--The Wisconsin Office of Credit Unions said it held off publishing its quarterly financial report on the state's credit unions until federal legislation passed to replenish the industry's deposit insurance and stabilize the corporate system passed. Eight of the 10 largest credit unions in Wisconsin posted losses--most of them more than $1 million--during first quarter because of the accounting for their contributions to the National Credit Union Share Insurance Fund to replenish the system, said the Milwaukee Journal Sentinel (May 26), which called the losses "stunningly bad." Suzanne Cowan, director of the Office of Credit Unions, told the newspaper the agency held off publishing its quarter report, aware of how the numbers looked but knowing that congressional action was in the works to spread the insurance fund replenishment cost over time. "We were just waiting to make sure that got passed before we put out our numbers because they are so ugly," said Cowan. Because of the new law, the first-quarter results won't stay dismal for long. "Now that Congress has given the chief national regulatory agency the authority to borrow up to $6 billion to help strengthen the industry, individual credit unions like those in Wisconsin will be able to make deposit insurance payments in increments over seven or eight years instead of all at once," said the newspaper. "That means many will be able to restate their earnings and erase the red ink for the first quarter." Wisconsin Credit Union League President/CEO Brett Thompson said spreading out the cost will put many credit unions back in the black. "Instead of absorbing 100%, essentially, of that cost this year, they will have to go back and restate and only absorb approximately 15% of that cost this year," he told the paper. "So many of those that were otherwise negative are going to be positive once they've restated." For the full article, use the link.


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