ALEXANDRIA, Va. (3/2/09)—The most recent monthly National Credit Union Share Insurance Fund (NCUSIF) report showed the fund booked both the expenses and the income associated with the corporate credit union stabilization plan in January. The National Credit Union Administration’s (NCUA) NCUSIF booked, for accounting purposes, a $1 billion expense for “Loss on Investment – Corporate” that is related to its capital infusion into U.S. Central FCU. It also booked a $3.7 billion "Insurance Loss Expense" to control for the risk associated with NCUA's guarantee of "excess" corporate credit union share deposits. The information was revealed last week at the NCUA’s open board meeting. Although the NCUA booked the $1 billion investment in U.S. Central as an insurance fund loss, that investment has not been economically impaired. The agency is writing it off because the money will not be available to pay off any possible future insurance losses until U.S. Central repays the NCUSIF's "capital note." The $3.7 billion related to the corporate share guarantee has similarly not been economically impaired, but has been added to the NCUSIF's reserve for insurance losses, which now stands at over $3.9 billion. However, the NCUA also booked the NCUSIF’s $4.84 billion in “accrued recapitalization and premium income” in January, again for accounting purposes, despite the fact that NCUA has not yet collected the premium from credit unions. Unless the NCUA adopts an alternative approach to how the costs of the corporate stabilization program will be paid or changes course on its accounting decision, its action could force credit unions to have to reflect all of their insurance costs for the corporate assistance, the replenishment of the 1% deposit and the premium, on their March call reports. The NCUA, as a government agency, has flexibility to deviate from Generally Accepted Accounting Principles (GAAP) in its financial reporting if the Office of Management and Budget (OMB) and the Comptroller General agree to such a deviation. The Credit Union National Association (CUNA) has urged the agency to work with OMB and the Comptroller General to use that authority to spread out the impact of the agency’s Corporate Credit Union Stabilization program on the NCUSIF and ultimately credit unions, said Mary Dunn, CUNA deputy general counsel, last week. She added, “We will continue pressing NCUA to take steps to mitigate the costs of the assistance to the corporate credit unions.” The NCUA also reported that January 2009 NCUSIF actual net income was $150.7 million, significantly higher than the $128.3 million in net income that NCUA staff originally budgeted for January 2009.