Struggling credit union changes hands in sale
The Wisconsin Office of Credit Unions on Tuesday closed the Beloit-based First American Credit Union. The National Credit Union Administration was appointed liquidating agent and quickly signed an agreement with First Community Federal Credit Union of Parchment, Mich., to buy First American.
In a news release, the NCUA said First American Credit Union’s declining financial condition led to its closure and subsequent purchase. At closure, First American had $136.9 million in assets and served more than 17,447 members.
NCUA records indicate that First American lost almost $1.2 million through the first half of 2010 after losing nearly $5.6 million in 2009. More than 13 percent of its loans were delinquent, compared with the average of 1.6 percent among peer credit unions.
NCUA is the independent federal agency that regulates, charters, and supervises federal credit unions.
First American, formed in 1933 by a group of Beloit Iron Works employees, is the 15th federally insured credit union liquidation in 2010. It has two branches in Beloit and one each in Janesville and Rockton, Ill. It will continue to operate under its current name.
First American CEO Tracy Blaske said a tighter lending climate and provisions for potential loan losses created hardship for First American.
“In the coming months of the transition, we’re certain that our members will experience little to no changes to the types of programs and account access that they’ve enjoyed in the past,” Blaske said. “Our ability to compete in products and pricing will grow, and our members will continue to see familiar faces here to serve them.”
First Community President and CEO Cheryl A. DeBoer said First American’s members will continue to be served locally.
“Combining of forces provides renewed ability to serve the financial needs of area residents and small business owners within the state line area,” she said. “Times of economic uncertainty in our region can create hardships for even well performing credit unions.
“We’re excited to be able to bring regional strength, while preserving local service to the current 17,500 members of First American Credit Union.”