Credit Unions Hit by Housing Downturn

Credit unions moved billions of additional dollars into their loan loss reserves in the fourth quarter, creating some of the biggest losses in the history of the industry, according to preliminary fourth-quarter data submitted to the National Credit Union Administration. According to the Credit Union Journal, the biggest loser in the fourth quarter was Wescom CU, a $4 billion Pasadena, Calif.-based credit union that boosted its loan loss reserves by $24.3 million, or 68%, causing losses of $26.3 million for the quarter and a whopping $33.2 million for the year. Several other large California credit unions, where the mortgage market has been hit harder than in most states, also reported huge losses for 2007, like USA FCU, with a loss of $5.8 million; Sterlent CU, $4.8 million: Kaiperm FCU, $3.8 million: Xerox FCU, $3.4 million: E1 Financial CU, $1.4 million; and Kaiser Lakeside CU, $1.4 million.