INDIANAPOLIS (AP) — A credit union formed nearly six decades ago by Indianapolis newspaper employees has been liquidated, two months after regulators placed the financially-troubled entity in conservatorship.
The National Credit Union Administration took the liquidation action Wednesday against Indianapolis’s Newspaper Federal Credit Union. The credit union’s Indianapolis office has closed and its two ATM machines are now inactive, the Indianapolis Business Journal reported.
The NCUA said in a statement that it “made the decision to liquidate Indianapolis’ Newspaper Federal Credit Union and discontinue its operations after determining the credit union was insolvent and has no prospect for restoring viable operations on its own."
The credit union was founded in 1962 by employees of The Indianapolis Star and now-defunct The Indianapolis News.
The NCUA had taken control of the credit union in January because of what it described as unspecified “unsafe and unsound practices” at the organization. The credit union’s financial situation had deteriorated markedly over the past year or so, with ballooning losses from bad loans.
About 500 credit union members, and most of their deposits, have been transferred to Indianapolis-based Elements Financial Federal Credit Union. Member deposits are protected through the National Credit Union Share Insurance Fund, which insures individual accounts up to $250,000.
The NCUA has retained a portion of the credit union's deposits, as well as all of its loans. Denver, Colorado-based Statebridge Co. LLC will act as the servicer for these loans.