Regulators seize Arrowhead Credit Union in San Bernardino
Federal regulators have taken over Arrowhead Central Credit Union of San Bernardino, citing the "declining financial condition" of the large, 61-year-old not-for-profit firm.
For Arrowhead's 152,000 members in the Inland Empire, operations were to continue as before under the conservatorship of the National Credit Union Administration. The NCUA, which seized Arrowhead late Friday, said in a news release that it would put "expert management in place correcting previous service and operational weaknesses."
The credit union's members are each federally insured for up to $250,000 in deposits.
With $876 million in assets, Arrowhead has 24 branches, some of them inside Stater Bros. supermarkets. It was one of a handful of large California credit unions that have been struggling amid the deep recession. Some already have been merged with sounder institutions, but the NCUA had been unable to find a partner for Arrowhead.
Founded in 1949 to serve San Bernardino County employees, Arrowhead had expanded to allow membership by any resident of San Bernardino or Riverside counties. Its offerings to members had included car loans and home-equity credit lines -- products prone to losses in a region that has been among the hardest hit by the housing debacle and unemployment.
Arrowhead reported $2.6 million in net income for the first quarter of this year following losses of $47.1 million in 2009 and $28.6 million in 2008.
The conservatorship is the second-biggest ever for a retail credit union, said John J. McKechnie III, a spokesman for the NCUA. The largest, which occurred in April 2009, was for Eastern Financial Florida Credit Union, an institution with $1.6 billion in assets that later was merged into the Space Coast Credit Union.
--E. Scott Reckard