Quarterly loss seen as positive
The state's largest credit union found a silver lining in the report that it lost $3.6 million in the third quarter.
Silver State Schools Credit Union said in a statement that its losses are declining. The giant credit union said it lost $16.8 million in the third quarter last year and $4.9 million in the second quarter this year.
In an apparent reference to gross earnings, rather than net loss, Silver State CEO Dave Rhamy said in a statement that the credit union "has seen a marked improvement in earnings over the prior year."
Charles Bruen, the top executive at $800 million-asset First Entertainment Credit Union in Los Angeles, questioned the accuracy of that statement in a blog.
"I don't see a sharp improvement in earnings," Bruen said.
Bruen noted that Silver State reported gross income of $43,000 in the first nine months, compared with gross income of $51.7 million last year.
Silver State Schools is the largest Nevada credit union with deposit insurance from American Share Insurance, a private insurer, rather than the federal government.
"There would be a huge reputational risk for all credit unions if Silver State Schools takes a turn for the worst," Bruen said.
He was referring to the 45 credit unions and bank-like companies in Rhode Island. In 1991, a private company that insured the Rhode Island institutions failed and 250,000 accounts totaling $1.7 billion were frozen at the financial institutions.
About 18 months later, most depositors had recovered most or all of their money, according to The New York Times. Rhode Island boosted sales tax rates and issued bonds to cover losses at the privately insured institutions.
Silver State is one of four credit unions in Southern Nevada that rely on American Share for deposit insurance, rather than the National Credit Union Administration, a federal agency.
Rhamy didn't respond to a call and e-mail requesting comment.
A spokesman for American Share responded in a voice mail, saying he was traveling and would call back later.
Contact reporter John G. Edwards at jedwards@reviewjournal.com or 702-383-0420
