Recent changes to FDIC Insurance
Joel K. Phillipps | Community Banker
The $250,000 FDIC Insurance Limit has been extended through Dec. 31, 2013. On Jan. 1, 2014, the standard insurance limit will return to $100,000 for all account categories except IRAs, which will remain at $250,000 per depositor.
All Shoreline Bank personal and business checking, savings, money market, and certificates of deposit are eligible for FDIC insurance coverage. Individual Retirement Accounts (IRAs) are insured separately up to $250,000. FDIC insurance does not cover safe deposit boxes.
In determining FDIC coverage, it is important to know how an account is titled, not just how much money is in the account. A family can have much more than $250,000 in their account and still be fully insured. For example, a single ownership account may only provide 250,000 in coverage where a joint account with two owners is insured up to $500,000 ($250,000 for each owner). Another change to FDIC requirements is that beneficiaries are no longer required to be close relatives. Each beneficiary will provide $250,000 in additional coverage for each account owner. Thus, a joint account with two additional beneficiaries would be insured up to $1 million.
A little known revision to FDIC coverage now provides non-interest bearing transaction accounts at some banks unlimited coverage through December 31, 2009 (this would include most business checking accounts at Shoreline Bank). For more information about FDIC coverage visit our website www.eshorelinebank.com You will find a link directly to the FDIC’s insurance calculator under the FDIC tab of the Deposit Insurance section. As always, we welcome your call or visit. Our bankers stand ready to discuss new opportunities provided by the FDIC’s enhancements.
Deposit Insurance Coverage
Temporary Increase in Coverage
October 3, 2008
Summary:
On October 3, 2008, President George W. Bush signed the Emergency Economic Stabilization Act of 2008, which temporarily raises the basic limit on federal deposit insurance coverage from $100,000 to $250,000 per depositor. The temporary increase in deposit insurance coverage became effective immediately upon the President's signature. The legislation provides that the basic deposit insurance limit will return to $100,000 after December 31, 2009.
_________________________________
ICBA Debunks Deposit Insurance Myths
Washington, D.C. (July 17, 2008)—The Independent Community Bankers of America (ICBA) is challenging unfounded concerns raised about the safety of bank deposits. Federal deposit insurance guarantees your deposits are safe in every financial institution insured by the Federal Deposit Insurance Corporation, including community banks. Don’t believe the hype. Get the facts.
Myth: Your money is safer in big banks.
Fact: No one has ever lost a penny of FDIC-insured deposits held in community banks. The FDIC insures deposits up to $100,000 per depositor and $250,000 for certain retirement accounts. If you have more than $100,000 at a community bank, you can still be fully insured if your accounts meet certain requirements. For example, accounts owned by a single person are separately insured from joint accounts or retirement accounts owned by that person. The FDIC’s Electronic Deposit Insurance Estimator (on the Web at www.fdic.gov/edie can determine your coverage.
Community banks focus on the needs of local families, businesses and farmers, and their top executives are generally available on site to answer your questions directly and make timely decisions. Many of the nation’s largest banks are structured to serve large corporations and have CEOs headquartered in office suites, not local banks.
Myth: Your money is stored in a vault at the bank.
Fact: Community bank deposits are reinvested in your local economy. Your money on deposit will be used to make loans in the community that help your neighbors start a nearby business, purchase a home, or send a son or daughter to college. Continuing to hold deposits in community banks ensures the neighborhoods where you live and work will continue to grow and thrive.
Myth: Community banks are undercapitalized.
Fact: The vast majority of our nation’s banks, especially community banks, are strong, safe and stable. Community bankers are common sense lenders that don’t engage in high-risk activities. Instead, they stick to the longstanding fundamentals of responsible banking, and always seek to serve the long-term interests of their customers and communities.
Myth: The FDIC takeover of IndyMac Bancorp means my bank is at risk.
Fact: IndyMac Bancorp was taken over because, in part, depositors became fearful and attempted to close their accounts at once, destabilizing the bank. The overwhelming majority of the nation’s banks are safe and well capitalized. As stated by FDIC Chairman Sheila Bair, IndyMac is only one of nearly 8,500 depository institutions operating in the United States and represents just 0.2 percent of banking-industry assets. There is little chance your bank will be taken over by the FDIC. And if that does happen, you will continue to have virtually uninterrupted access to your insured deposits.
Myth: Community banks are involved in problems with subprime mortgage lending.
Fact: Community banks are common-sense lenders that have avoided subprime lending. There is no mortgage-lending crisis for community banks because they are well-run, highly capitalized, tightly regulated and more risk-averse than big banks. Community banks have money to lend homeowners for new purchases and to refinance existing mortgages. In spite of talk of a credit crunch, community banks are open for business.
Joel K. Phillipps | Community Banker
The $250,000 FDIC Insurance Limit has been extended through Dec. 31, 2013. On Jan. 1, 2014, the standard insurance limit will return to $100,000 for all account categories except IRAs, which will remain at $250,000 per depositor.
All Shoreline Bank personal and business checking, savings, money market, and certificates of deposit are eligible for FDIC insurance coverage. Individual Retirement Accounts (IRAs) are insured separately up to $250,000. FDIC insurance does not cover safe deposit boxes.
In determining FDIC coverage, it is important to know how an account is titled, not just how much money is in the account. A family can have much more than $250,000 in their account and still be fully insured. For example, a single ownership account may only provide 250,000 in coverage where a joint account with two owners is insured up to $500,000 ($250,000 for each owner). Another change to FDIC requirements is that beneficiaries are no longer required to be close relatives. Each beneficiary will provide $250,000 in additional coverage for each account owner. Thus, a joint account with two additional beneficiaries would be insured up to $1 million.
A little known revision to FDIC coverage now provides non-interest bearing transaction accounts at some banks unlimited coverage through December 31, 2009 (this would include most business checking accounts at Shoreline Bank). For more information about FDIC coverage visit our website www.eshorelinebank.com You will find a link directly to the FDIC’s insurance calculator under the FDIC tab of the Deposit Insurance section. As always, we welcome your call or visit. Our bankers stand ready to discuss new opportunities provided by the FDIC’s enhancements.
Deposit Insurance Coverage
Temporary Increase in Coverage
October 3, 2008
Summary:
On October 3, 2008, President George W. Bush signed the Emergency Economic Stabilization Act of 2008, which temporarily raises the basic limit on federal deposit insurance coverage from $100,000 to $250,000 per depositor. The temporary increase in deposit insurance coverage became effective immediately upon the President's signature. The legislation provides that the basic deposit insurance limit will return to $100,000 after December 31, 2009.
_________________________________
ICBA Debunks Deposit Insurance Myths
Washington, D.C. (July 17, 2008)—The Independent Community Bankers of America (ICBA) is challenging unfounded concerns raised about the safety of bank deposits. Federal deposit insurance guarantees your deposits are safe in every financial institution insured by the Federal Deposit Insurance Corporation, including community banks. Don’t believe the hype. Get the facts.
Myth: Your money is safer in big banks.
Fact: No one has ever lost a penny of FDIC-insured deposits held in community banks. The FDIC insures deposits up to $100,000 per depositor and $250,000 for certain retirement accounts. If you have more than $100,000 at a community bank, you can still be fully insured if your accounts meet certain requirements. For example, accounts owned by a single person are separately insured from joint accounts or retirement accounts owned by that person. The FDIC’s Electronic Deposit Insurance Estimator (on the Web at www.fdic.gov/edie can determine your coverage.
Community banks focus on the needs of local families, businesses and farmers, and their top executives are generally available on site to answer your questions directly and make timely decisions. Many of the nation’s largest banks are structured to serve large corporations and have CEOs headquartered in office suites, not local banks.
Myth: Your money is stored in a vault at the bank.
Fact: Community bank deposits are reinvested in your local economy. Your money on deposit will be used to make loans in the community that help your neighbors start a nearby business, purchase a home, or send a son or daughter to college. Continuing to hold deposits in community banks ensures the neighborhoods where you live and work will continue to grow and thrive.
Myth: Community banks are undercapitalized.
Fact: The vast majority of our nation’s banks, especially community banks, are strong, safe and stable. Community bankers are common sense lenders that don’t engage in high-risk activities. Instead, they stick to the longstanding fundamentals of responsible banking, and always seek to serve the long-term interests of their customers and communities.
Myth: The FDIC takeover of IndyMac Bancorp means my bank is at risk.
Fact: IndyMac Bancorp was taken over because, in part, depositors became fearful and attempted to close their accounts at once, destabilizing the bank. The overwhelming majority of the nation’s banks are safe and well capitalized. As stated by FDIC Chairman Sheila Bair, IndyMac is only one of nearly 8,500 depository institutions operating in the United States and represents just 0.2 percent of banking-industry assets. There is little chance your bank will be taken over by the FDIC. And if that does happen, you will continue to have virtually uninterrupted access to your insured deposits.
Myth: Community banks are involved in problems with subprime mortgage lending.
Fact: Community banks are common-sense lenders that have avoided subprime lending. There is no mortgage-lending crisis for community banks because they are well-run, highly capitalized, tightly regulated and more risk-averse than big banks. Community banks have money to lend homeowners for new purchases and to refinance existing mortgages. In spite of talk of a credit crunch, community banks are open for business.