B&C Exposure Cited in CU Loss

Increased exposure to the subprime mortgage market, specifically mortgage-backed securities, caused U.S. Central FCU to take losses of almost $17 million in the third quarter, according to the credit union.Losses and increasing troubles in its MBS portfolio prompted Standard & Poor's to downgrade U.S. Central's short-term outlook from stable to negative. "The outlook revision," the rating agency said, "reflects increased concerns about USC's exposure to subprime, home equity, and other MBS." USC has a federal credit union charter and is regulated by the National Credit Union Administration. It serves as a "central banker" for the nation's 40 regional corporate credit unions. Regionals, in turn, provide liquidity to the nation's 8,500 personal credit unions.