The National Credit Union Administration on Thursday placed Newspaper Federal Credit Union in Indianapolis into conservatorship.
It is the
The regulator cited “unsafe and unsound” practices at Indianapolis’ Newspaper FCU, though did not specify what those practices were. The credit union holds $6.6 million in assets and serves more than 1,100 members. While chartered to serve newspaper employees in the city, it serves other select employee groups in the region as well.
Third-quarter call report data for the credit union shows a loss of more than $852,000 during the first nine months of 2020, far exceeding the roughly $12,000 it lost during the same period in 2019 or even the $98,000 losses incurred during the first three quarters of 2018. Some of 2020’s losses were fueled by a 256% rise in charge-offs and a nearly 80% decrease in recoveries. Noninterest expenses were also up by 50% year-over-year, due in part to rising office and staffing costs. Interest income was up slightly, but that was offset by a 27% decrease in noninterest revenue. Allowances for loan losses rose by more than 400%. Reportable delinquencies rose from four loans totaling a little less than $27,000 at the end of the third quarter of 2019 to 19 loans totaling $526,000 as of Sept. 30, 2020, with most of that concentrated in used car lending.
Indianapolis’ Newspaper FCU remains open while under NCUA management and members’ shares are federally insured for up to $250,000.
