WesCorp’s former CEO has been slapped with a prohibition order and a $600,000 fine by the National Credit Union Administration. The move closes another chapter in the corporate failure saga that cost credit unions billions and called into question the regulator’s oversight during the collapse.
Northwest credit unions lost millions in interest income last year when the NCUA forced early redemption of CDs held by WesCorp. Its successor, Western Bridge, was formally liquidated last month, and Catalyst now holds a handful of unredeemed CDs.
The NCUA has awarded Catalyst Corporate Federal Credit Union the bid to acquire WesCorpâ€™s operations in a move heralded as a solution for Northwest natural-person credit unions. Catalyst recently announced â€œwell-capitalizedâ€ status.
CEOs from Catalyst, SunCorp and FirstCorp Expected to Court Northwest Credit Unions Looking for Alternatives to WesCorp
Many Northwest credit unions may need alternative services after Western Bridge failed to meet Wednesdayâ€™s deadline to re-capitalize as United Resources Corporate Credit Union. Established corporate credit unions and other service providers will pitch their services at the NWCUAâ€™s Convention.
WesCorp Will Not Emerge From Conservatorship as United Resources; Regulator Urges Member Credit Unions to Stay Put Until a Merger is Worked Out
The NCUA has announced that three corporate bridge credit unions did not meet recapitalization goals. WesCorp, US Central and SE Corporate will not emerge as new entities. A number of Northwest credit unions have already been stung by WesCorpâ€™s downfall.
A federal court ruling dismisses negligence charges against directors of WesCorp but key executives still face trail in a civil suit claiming their actions caused the huge corporate to fail.
Northwest credit unions will lose millions of dollars in interest income as the result of the forced early redemption of term certificates deposited in WesCorp.