Your money is safe with us

Recent bank failures highlight the difference in how we operate.

March 14, 2023

 

Recent failures of banks in the news

The federal government takeover of California-based Silicon Valley Bank [SVB] ($205 billion assets) on Friday was the second largest U.S. bank failure, and Sunday’s failure of New York-based Signature Bank ($110 billion assets) was the third largest. These banks focused a lot on technology start-ups and cryptocurrency respectively. It is reported that around 30% of Signature Bank’s deposits came from the crypto industry. SVB had a very high percentage of its deposits uninsured as well. The average in the credit union system is 8%. So, these two banks were different from credit unions and many other banks given the focus of their activities and structure of their balance sheets.

 

Is MidWest America financially sound?

MidWest America Federal Credit Union’s members should know that we are a safe place to save money. We are well capitalized and in solid financial position to meet the saving and borrowing needs of our members. MidWest America has sound financial policies and receives high rankings annually from regulators for safety and soundness practices and management of risk. For example, MidWest America has continually earned the 5-Star rating according to BauerFinancial Inc. The Florida-based firm has been analyzing and reporting on the financial condition of the nation’s banking industry since 1983. No institution pays for its rating; nor, can they avoid a rating. The 5-star award recognizes MidWest America’s continual superior performance and strength. It is based on an analysis of current financial data as supplied by federal regulators, supplemented by historical data.

Deposits at MidWest America are protected by the National Credit Union Share Insurance Fund and insured up to at least $250,000 per individual depositor – the same as any other federally insured financial institution. That means we are backed by the full faith and credit of the U.S. government.

In addition, MidWest America also provides excess deposit insurance through ESI, a subsidiary of American Share Insurance. American Share Insurance has powered private deposit insurance for up to $250,000 per member account since 1974 without experiencing a loss. Currently, American Share Insurance insures $2.2 billion from 1.3 million members.  American Share Insurance is licensed and dually regulated by the Ohio Department of Insurance and the Ohio Department of Commerce, as well as supervised by credit union regulators in the states of operation. American Share insurance is also audited annually by the accounting firm Deloitte & Touche, LLP. 

 

NCUA Protection

The credit union system remains well-capitalized and on a solid footing.  The agency continues to monitor credit union performance through both the examination process and offsite monitoring, and it will continue to do so into the future. Credit unions have access to a wide range of liquidity sources.  The NCUA, along with its Central Liquidity Facility is able to provide a back-up source of liquidity to member credit unions as needed. The agency continues to coordinate with the other federal financial institution regulators to ensure the continued resiliency of the American financial services system. As always, the NCUA is committed to the protection of credit union members and the safety and soundness of the credit union system overall.  No one has ever lost a single penny of insured share deposits within the credit union system.

 

Beware of scams in these types of situations

Members should be aware that scams have already been reported of fraudsters trying to alarm consumers by communicating that a bank or credit union is under Federal Bureau of Investigation (FBI) review. Please be on alert for suspicious calls or emails asking you to withdrawal funds from your credit union or bank for their own purposes. Scammers like to use situational news to their advantage to get you to make impulsive decisions with your money.  Please be diligent in considering any suspicious inquiries about your finances.

If you have any questions, about the financial soundness of your credit union, please contact us with any of your concerns.