NCUA Requirements - 2 - Federal Share Insurance Flashcards
When a federally insured credit union is in trouble, what is the first step NCUA will take before liquidating the credit union?
NCUA’s first preference is to find a merger partner for a federally insured credit union experiencing problems. (Page 2-2)
Federally insured credit unions are required to maintain a deposit with the NCUSIF. This deposit must equal __________ percent of the credit union’s insured shares.
One percent. (Page 2-3)
When a credit union is insured by the National Credit Union Share Insurance Fund (NCUSIF), NCUA requires the credit union to make that fact known to its members. One of the requirements is to have the “official advertisement
statement” in marketing pieces. What are the other two requirements?
The credit union must provide copies of the NCUA brochure Your Insured Funds at each branch office and display the NCUSIF official sign at each teller station in the main office and at each branch office. (Page 2-6)
The following accounts are held by members A, B, and C, each of whom has personally executed signature cards for the accounts in which he has an interest.
Each co-owner of a joint account possesses the necessary withdrawals rights.
1. A, as an individual — $250,000
2. B, as an individual — $250,000
3. C, as an individual — $250,000
4. A and B, as joint tenants w/r/o survivorship — $240,000
5. A and C, as joint tenants w/r/o survivorship — $240,000
6. B and C, as joint tenants w/r/o survivorship — $240,000
7. A, B, and C, as joint tenants w/r/o survivorship — $240,000.
What is the insurance coverage?
Accounts numbered 1, 2, and 3 are each separately insured for $250,000 as individual accounts held by A, B and C, respectively. The interests of the co-owners of each joint account are deemed equal for insurance purposes. A’s
interest in accounts numbered 4, 5, and 7 are added together for insurance purposes. Thus, A has an interest of $120,000 in account No. 4, $120,000 in account No. 5 and $80,000 in account No. 7, for a total joint account interest of
$320,000, of which $250,000 is insured. The interest of B and C are similarly insured. (Page 2-27 to 2-29)
How does share insurance coverage for revocable trust accounts differ when the beneficiaries are natural persons, charitable organizations, or non-profit entities and when they are not?
When the beneficiaries are natural persons, charitable organizations and nonprofit entities the funds are insured, for the owner, up to $250,000 for each beneficiary—separate from any individual accounts of the owner. The interests of beneficiaries (other than natural persons, charitable organizations or nonprofit entities) would be aggregated with the individually owned funds of the
grantor/owner. (Page 2-31)
