More than $560 million will be distributed to more than 2,100 credit union shareholders by their federal regulator, the agency said Monday, in capital and dividends from conserved “corporate” credit unions.
The distributions are expected to be made by the end of March.
In a release, the National Credit Union Administration (NCUA) said distributions totaling $359.2 million were made to credit union membership capital shareholders of the former Members United, Constitution, U.S. Central, and corporate credit unions. Another $209.8 million in dividends was paid to more than 1,100 credit union shareholders of Southwest Corporate Credit Union, the agency said. (NCUA completed capital distributions to Southwest Corporate capital holders last year, it said in its release.)
Corporate credit unions are a type of “bankers bank” that offer services to consumer credit unions, typically in the forms of liquidity, credit, deposits and payments. The corporates do not typically serve individual members of credit unions.
The agency noted that it had previously made three rounds of distributions. In 2020 and 2021, the NCUA said, capital holders of Southwest (based in Texas), Members United (Illinois), and U.S. Central (Kansas) corporates received distributions. The distributions to member capital shareholders of Constitution corporate (based in Connecticut) are included for the first time in the distributions, set to occur before the end of the first quarter (March 31).
NCUA said that, with this fourth distribution, it will have returned more than $1.8 billion to former membership capital shareholders and $209.8 million in dividends to shareholders.
The four corporates were conserved in 2008 in the wake of the financial crisis, which contributed to the collapse of the corporate credit union system. Under its Corporate System Resolution Program, credit unions, in NCUA’s words, absorbed “the failures of U.S. Central, Western (California), Southwest, Members United, and Constitution corporate credit unions over time.”