NCUA conserves two West Virginia credit unions

The National Credit Union Administration has placed two credit unions — both located in West Virginia — into conservatorship.

The NCUA announced Friday that it will temporarily take charge of the $479,000-asset O.F. Toalston Federal Credit Union in Logan, West Virginia, to address concerns regarding unsafe and unsound business practices. The credit union reported having 175 members who are employees of the Appalachian Power Company at the Logan Plant and in the Logan District, which includes Logan, Boone, Mingo, Lincoln and Wyoming counties.

The credit union posted net income of almost $8,000 for the first six months of this year, up slightly from about $6,000 for the same period in 2021, according to NCUA call report data. Net interest income dropped in the same time frame, from about $18,000 in 2021 to roughly $15,000 this year.

The agency also said it will oversee operations for the $2.7 million-asset Mingo County Education Federal Credit Union in Williamson, West Virginia, citing similar concerns of unsafe and unsound business practices. Mingo County Education FCU provides access to financial services for those working at primary and secondary public, private, and parochial schools as well as colleges and universities within the county.

Mingo County reported a net income of about $25,000 in the first half of this year, down about 60% from the same period a year earlier, according to NCUA call report data. Net interest income also dropped about 24%, to almost $74,000.

Members of both institutions will be able to conduct business as normal under the conservatorships, including depositing and accessing funds and making loan payments. The NCUA did not provide a timeline for when the conservatorship of either credit union could end. 

Both West Virginian institutions are the first institutions to be conserved by the regulator this year. The NCUA has liquidated two institutions so far in 2022, including Paducah Teachers Federal Credit Union in Paducah, Kentucky, and Empire Financial Federal Credit Union in New York.

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