Late developments, from the Wall Street Journal:
In an effort to prevent financial upheaval at America’s credit unions, federal regulators guaranteed tens of billions of dollars in uninsured deposits at the powerful financial institutions that service them — an unprecedented move that shows how the credit crisis continues to ripple through the economy.
Regulators also injected $1 billion of new capital into the largest of these wholesale credit unions, U.S. Central Federal Credit Union of Lenexa, Kan., after its unexpected loss Wednesday of $1.1 billion for 2008. U.S. Central serves essentially as a main clearinghouse for the others in the network.
Credit unions in general were believed to be among the most conservatively managed financial institutions. Wednesday’s sweeping move comes amid mounting losses on mortgage securities.
