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P-and-A arranged for Kaiperm FCU
ALEXANDRIA, Va. (9/30/08)—The National Credit Union Administration (NCUA) negotiated a deal for Alliant CU of Chicago to purchase the assets and assume the members of Kaiperm FCU of Oakland, Calif. as the least costly way to address Kaiperm’s flagging position. In June, Kaiperm announced it was working to negotiate a merger with $5.7 billion-asset Alliant. Kaiperm decided to pursue the merger after its research concluded a merger was the best way to improve and enhance financial services for its members. It was reported that during the first three months of this year, the credit union posted losses of $2.2 million. The NCUA Monday announced its decision to liquidate Kaiperm and discontinue its independent operation after determining the credit union was insolvent and has no prospects for restoring viable operations. At the time of liquidation, Kaiperm FCU had approximately $91 million in assets and served 18,000 members. An NCUA release noted that the new Alliant CU members will continue to receive convenient, uninterrupted service. It reminded that credit member accounts in Alliant are insured up to at least $100,000 by the National Credit Union Share Insurance Fund (NCUSIF), an entity of the federal government operated by NCUA. Certain retirement accounts, such as IRA and KEOGH accounts, are insured up to $250,000. Alliant is a state-chartered, federally insured chartered in 1935 to serve employees of United Airlines. It is a full-service credit union with more than 216,000 members located throughout the United States. Alliant CU has 10 service centers nationwide and no-fee ATM service at over 75,000 locations. The NCUA chartered Kaiperm in 1957 to serve employees of Kaiser Foundation medical facilities in the East Bay area of Northern California and over time the field of membership expanded to include numerous select employee groups. The NCUA has emergency supervisory field of membership authority for credit unions in danger of closing. The agency can use the authority both in mergers and purchase and assumption arrangements.


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