With the passage of the Emergency Economic Stabilization Act of 2008, your funds are now safer than ever. Under the act, the National Credit Union Administration (NCUA) will increase share insurance protection to at least $250,000 on all types of accounts. NCUA has always insured shares to at least $100,000, with additional coverage of up to $250,000 for certain retirement accounts. The increase in share protection will continue until at least Dec. 31, 2009.
Your accounts in a federally insured credit union are backed by the National Credit Union Share Insurance Fund (NCUSIF), a fund maintained by the U.S. Treasury and administered by the NCUA.
NCUA coverage is to credit unions as FDIC, or Federal Deposit Insurance Corporation, coverage is to banks. Both funds are backed by the full faith and credit of the U.S. government.
Credit unions are among the safest institutions in America. In the history of credit unions’ insurance fund, not one penny of insured savings has ever been lost by a member of a federally insured credit union. And, no taxpayer funds have ever been used for a bailout.
Media including CNN, the Wall Street Journal, USA Today and the Capitol Hill publication Politico have pointed to credit unions as a safe harbor during troubled times because they avoid the bad lending practices that caused today’s financial crisis.