Thursday, January 29, 2009
Lyn Peters, Director of Communications
PH (360) 902-8731 email@example.com
Linda Jekel, DFI Director, DFI Division of Credit Unions
PH (360) 902-8701 firstname.lastname@example.org
FOR IMMEDIATE RELEASE:
DFI Supports NCUA Decision To Protect Corporate Credit Union System With $1 Billion Capital Note And Restructuring
Premium assessment declared to restore equity ratio
OLYMPIA – The Washington State Department of Financial Institutions supports the recent actions taken by the National Credit Union Administration (NCUA) board to protect the corporate credit union industry.
“Today’s announcement shows the NCUA is taking the necessary steps to strengthen the credit union system and protect depositors during these trying times,” DFI Director of Credit Unions Linda Jekel said. "As regulators, DFI's Division of Credit Unions routinely monitors and examines Washington's credit unions to ensure they are safe and sound."
“The actions taken by NCUA will help corporate credit unions and will ultimately benefit all credit union members,” Jekel continued. “State regulators and NCUA are working together to maintain the confidence in the credit union system because credit unions are vital to helping Washington residents with their borrowing and investment needs.”
The NCUA Board approved the following:
- Guarantee uninsured shares at all corporate credit unions through February 2009, and establish a voluntary guarantee program for uninsured shares of all corporate credit union through December 31, 2010;
- Issue a $1 billion capital note to U.S. Central Corporate Federal Credit Union (U.S. Central);
- Issue an Advance Notice of Public Rulemaking (ANPR) on restructuring the corporate credit union system; and
- Declare a premium assessment - to individual credit unions - to restore the National Credit Union Share Insurance Fund (NCUSIF) equity ratio to 1.30 percent, which will be collected in 2009.
For details, read NCUA’s press release (PDF)*.
“It is important for members of Washington’s credit unions to understand their deposits are insured up to $250,000 by the National Credit Union Share Insurance Fund,” Jekel added. “I encourage all credit union members to learn more about deposit insurance by visiting the NCUA’s Web site at http://www.ncua.gov.”
FAQs For Credit Union Members
In an effort to assist credit union customers who may have questions or concerns, DFI offers the following Q&A information:
Why did U.S. regulators guarantee all the deposits at corporate credit unions on Jan. 28, 2009?
The National Credit Union Administration (NCUA), the federal agency that insures credit union deposits, acted to add stability and strengthen the corporate credit unions system.
For more information, see NCUA’s press release (PDF)*.
What are corporate credit unions?
Corporate credit unions (corporate) are the retail credit union’s credit union. The corporate credit unions provide services to other retail credit unions, such as loans, check clearing and investments. U.S. Central Federal Credit Union, headquartered in Kansas, acts as the top of a three-tier credit union system. The second tier is comprised of 26 regional corporate credit unions that serve retail credit unions. The retail credit unions form the third tier and serve members from local communities, employers and associations. NCUA refers to retail credit unions as “natural person” credit unions.
Are there any corporate credit unions in Washington State?
No. Credit unions headquartered in Washington are retail credit unions, also known as “natural person” credit unions.
Will this affect my deposit insurance at my credit union?
All credit unions in Washington are federally insured and backed by the US Government. Your deposits continue to be insured at $250,000 through the National Credit Union Share Insurance Fund (NCUSIF) administered by NCUA.
Estimate your deposit insurance coverage.
Will this use taxpayer funds?
No. NCUA’s actions on Jan. 28, 2009 to strengthen the corporate credit union system will be financed by the credit union industry. NCUA announced it will charge an insurance premium to all federally insured credit unions to cover the cost.
How can I check on the financial health of my credit union?
The majority of credit unions in Washington are sound and well-capitalized. There are 127 credit unions (both state and federally chartered) headquartered in Washington State with $25.6 billion in assets. The 71 Washington state chartered credit unions have an average capital level of 10.17% of assets as of September 30, 2008 (the most recently published credit union financial statements). Well capitalized credit unions are expected to have at least 7% in capital. The majority of Washington’s credit unions have the capital sufficient to fund NCUA’s January 2009 actions and remain well capitalized. All federally insured credit unions send their quarterly financial statements and other data to a national database and it is posted on the NCUA Web site.
Find your credit union's most recently published financial statement.
The database allows you to select from the following information:
- The financial statement and other data (called a 5300 report)
- Financial Performance Report showing consolidated financial information, financial ratios, and peer ratios.
If you are not able to locate the desired Washington state chartered credit union financial information, call the Department of Financial Institutions at 360.902.8731 or 1.877.RING.DFI.
Who should I call if I have more questions about credit unions?
Your credit union has specialists trained to answer your questions about deposits and how to structure your accounts for the maximum amount of federal deposit insurance.
You may also call your credit union’s regulator.
For a list of Washington state chartered credit unions, see contact information for state chartered credit unions or call the Washington Department of Financial Institutions at 1-877-746-4334 or TDD: (360) 664-8126.
For a list of federally chartered credit unions, call NCUA Consumer Assistance Center at 1-800-755-1030.
www.dfi.wa.gov ▪ 360.902-8700 ▪ 877.746-4334
The Washington State Department of Financial Institutions regulates a variety of financial service providers such as banks, credit unions, mortgage brokers, consumer loan companies, payday lenders and securities brokers and dealers. The department has won numerous awards for its financial literacy and outreach programs developed to protect consumers from financial fraud. In addition to posting information about licensees and administrative actions, the DFI’s Web site features consumer tips on a variety of financial fraud-related topics.
About Division of Credit Unions
www.dfi.wa.gov/cu ▪ 360.902.8701 ▪ 877.RINGDFI (746.4334)
The Division of Credit Unions regulates state-chartered credit unions licensed to operate in Washington, while the National Credit Union Administration (NCUA), is the federal insurer of shares and deposits in our credit unions. NCUA also has authority to enforce most of the consumer protection statutes that deal with credit unions. The division enforces some of these statutes in examinations of state-chartered credit unions, and also processes consumer complaints for credit union customers.
* This document is a PDF file, and you will need Adobe Acrobat Reader to view it. If you don't already have Acrobat Reader installed on your computer, you may download it for free from Adobe.