Important Notice Regarding Recent NCUA Action

On March 20, 2009, the National Credit Union Administration (NCUA), the federal regulator for federally-insured credit unions, placed two “corporate credit unions,” U.S. Central Federal Credit Union and Western Corporate (WesCorp) Federal Credit Union into conservatorship. “Corporate credit unions” are similar to Federal Reserve Banks and do not deal directly with consumers, but provide investment, financing, check clearing, and other services to “retail credit unions” (also called “natural person credit unions”) such as Bourns Employees Federal Credit Union (Bourns EFCU).

We wish to assure you that these actions by NCUA  do not affect your deposits at the Credit Union. In fact, NCUA’s actions to stabilize corporate credit unions were taken to assure the continued safety and soundness of local “retail” credit unions. You can rest assured that your funds on deposit are insured by the National Credit Union Share Insurance Fund (NCUSIF) and continue to be backed by the full faith and credit of the United States Government, up to at least $250,000. In addition, Individual Retirement Accounts (IRAs) are insured separately up to $250,000.

While “retail” credit unions have not been immune to the national economic downturn, we are well-capitalized overall, we are strong, and we are well-positioned to weather the storm. We thank you for your continued participation as a member-owner of your Credit Union.

Important Information About Recent NCUA Actions

On January 28, 2009, the National Credit Union Administration (NCUA) notified retail credit unions about the stability of wholesale credit unions and their efforts to provide a back stop for these larger credit unions.

Refer to the NCUA's official site relating to the Corporate Stabilization Program for a more complete picture of its plans and efforts.

The action selected by NCUA in January calls for retail credit unions like Bourns EFCU to foot the bill through a series of transactions related to the National Credit Union Share Insurance Fund (NCUSIF). This is the nature of the cooperative structure in which credit unions operate and provides us with an opportunity to pay our own way, rather than relying on tax payer funds.

 Bourns EFCU has executed the transactions requested by the NCUA as it was instructed to do however, these actions have negatively impacted the Credit Union's bottom line as of the quarter which ended March 31, 2009. The Credit Union remains well-capitalized even after these actions and will weather this period of instability although it will mean short-term financial difficulties.

Click here for NCUA news relating to the Price Waterhouse Coopers LLC report that presented a laundry list of methods which might be incorporated to provide funding and capital for the NCUA's stabilization efforts.

The Credit Union, with its advocates at the California Credit Union League and the Credit Union National Association, is working to ensure that the financial impact to retail credit unions is minimized and that we have all the tools the industry needs to survive and thrive.

Credit Unions in the News

Recent news articles from around the country tell the story of credit unions and their response to the economic downturn.

Click here for Wall Street Journal article. (“Safe Havens: Credit Unions Earn Some Interest”)

Click here for Los Angeles Times article. (“Bill would limit loan, credit card rates.”)

Click here for New York Times article. (“Thoughts on Walking Away From Your Home Loan”)

For more information, email, call toll free at 1-877-426-8767 x 2, locally at 951-781-5600, or fax 951-781-5452. Office hours: 9:00 AM PST to 4:30 PM PST, Monday - Friday.

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