MCU Earnings Grow As It Avoids Pitfalls Of Sub-Prime Loans

The Municipal Credit Union over the past year increased its mortgage portfolio by 11 percent but was also able to boost net income by 3.5 percent, in large part because it refrained from sub-prime lending activities, according to MCU President Kam Wong.

The organization's acting board chairman, former Transport Workers Union Local 100 President Willie James, noted at the MCU's annual meeting last month that members increasingly looked to the group for help with buying homes, "trading up," or refinancing their mortgages.

'Prudence is Our Policy'

This was a driving force in the MCU for the first time surpassing $1 billion in outstanding loans to members, Mr. Wong said.

"Prudent asset, liability and risk management has been our operating policy," he said in a statement. "This enables us to thrive in any economic environment. It also ensures that we steer clear of unforeseen events such as the sub-prime lending crisis that overwhelmed so many financial institutions and people in 2007."

Noting that the MCU, which serves city, state and Federal employees and education and health-care professionals in the New York area, currently has 310,000 members and assets of more than $1.3 billion, Mr. Wong said he believed it was on target to meet its goals of 350,000 members and $1.5 billion in assets by 2010.