Volunteer Corporate Credit Union and Subsidiary Notes to the Consolidated Financial Statements (In Thousands)

Note 10: REGULATORY CAPITAL REQUIREMENTS (Continued)

At December 31, 2022 and 2021, VolCorp’s capital ratios were as follows:

The retained earnings ratio is key in maintaining capital adequacy in compliance with NCUA regulations. Beginning in October 2013, NCUA regulation 704.3 requires corporate credit unions to calculate and report a retained earnings ratio of at least 0.45%. VolCorp’s retained earnings ratio at December 31, 2022 and 2021 was 4.60% and 2.21%, respectively.

Non‐Pro Rata Capital Dividends

On October 5, 2010, VolCorp was issued recovery claim certificates of approximately $59,500 for membership capital accounts at U.S. Central Federal Credit Union previously depleted through the recognition of losses. U.S. Central Federal Credit Union was placed into liquidation on October 1, 2010. During 2022 and 2021, VolCorp recognized $23,924 and $32,672 of corporate credit union liquidation distributions related to the recovery claim certificates upon receipt of the distributions. During 2021, VolCorp paid $11,336 of non‐pro rata capital dividends to member natural person credit unions that recognized losses as a result of U.S. Central Federal Credit Union’s liquidation. During 2021, VolCorp also paid $3,698 of non‐pro rata interest distributions to association member natural person credit unions that recognized losses as a result of U. S. Central Federal Credit Union’s liquidation. No capital dividends related to member natural person credit unions that recognized losses as a result of U.S. Central Federal Credit Union’s liquidation were paid during 2022.

Based on NCUA projections, the remaining recovery claim certificates will be satisfied by distributions during future periods. VolCorp recognizes income from corporate credit union liquidation distributions during the period distributed funds are received.