Frequently Asked Questions

The NCUA Guaranteed Note (NGN) Program is a key component of NCUA’s Corporate System Resolution Program. The NGNs fund more than $40 billion in Legacy Assets from the corporate credit unions that failed during the economic crisis. The NGN Program involved a series of thirteen securitization transactions executed as part of the Corporate System Resolution Program. Each securitization is collateralized by Legacy Assets.  The NGNs have a NCUA guaranty for timely payment of interest and principal at maturity. The guaranty is backed by the full faith and credit of the United States and primarily funded by the Temporary Corporate Credit Union Stabilization Fund (Stabilization Fund). 

The NGN Program is a key part of NCUA’s strategy to resolve the corporate credit union crisis at the least long-term cost consistent with sound public policy. The NCUA implemented the NGN Program to resolve the failed corporate credit unions by isolating and funding their Legacy Assets. Isolating the Legacy Assets in the asset management estates positioned the assets to serve as collateral for the NGNs. Selling the NGNs into the market raised the cash needed to pay off the failed corporate credit unions’ liabilities while avoiding the immediate sale of distressed assets at a deep discount. These actions saved federally insured credit unions (credit unions) from incurring large additional losses had NCUA sold the Legacy Assets at the prevailing market values.  

The NGN Program began in October 2010. NCUA went to market with thirteen securitizations between October 2010 and June 2011. Each NGN has a stated maturity date upon which any remaining outstanding principal balance must be repaid in full. The stated maturity dates vary by series and range between June 2013 and June 2021. 

You can find the key characteristics of the Legacy Assets in the "Legacy Asset Profile - Overview" section of the transparency website at www.ncua.gov. Click the tab “Regulation & Supervision” and select the option “Guaranteed Notes Program,” then select “Overview” under “Legacy Assets” from the menu on the right. 

NCUA works with BlackRock Solutions to estimate the Legacy Assets’ current value and project future performance. The current expectations, including total projected costs to the credit union system, are available on the NCUA’s transparency website at www.ncua.gov. Click the tab “Regulation & Supervision” and select the option “Corporate System Resolution” or “Guaranteed Notes Program."

Changes in home prices, gross domestic product, unemployment, interest rates, and other economic variables are key assumptions in determining the value of the Legacy Assets for financial reporting purposes and the overall projected losses to the credit union system.

When the NGNs mature, the NCUA will consider all available options to minimize the overall cost to credit unions. Options may include, but are not limited to, the following:

1. Holding the Legacy Assets to maturity;
2. Selling the Legacy Assets into the market; or
3. Re-securitizing the remaining expected cash flows from the Legacy Assets in a manner similar to the NGN Program.

NCUA has dedicated transparency websites for the NGN Program and the Corporate System Resolution Costs. These websites and other additional information are available at www.ncua.gov. Click the tab “Regulation & Supervision” and select the option “Corporate System Resolution” or “Guaranteed Notes Program.” Details related to the individual Legacy Assets can be found at NCUA’s Corporate Credit Union FOIA Requests page.