Space Coast Credit Union Responds to Current Media Coverage of Banking and Mortgage Issues
There is warranted concern about the viability of banking due to the recent news about bank failures. Space Coast Credit Union would like to reassure its members that the credit union is strong, that the credit union continues to grow, and that our members' deposits are safe.
While FDIC insurance has been widely discussed in the media, little has been said about coverage for deposits in credit unions.
Space Coast Credit Union's deposits are insured by the National Credit Union Share Insurance Fund. The NCUSIF is managed by the National Credit Union Administration (NCUA); the credit union's insurer. NCUA and FDIC coverage are both backed by the full faith and credit of the Federal government. For more information about this coverage, click on the link below. You may also call the Member Service Center, visit any branch, or contact the NCUA Insurance Call Center directly at 1-800-755-1030, extension 1.
Space Coast Credit Union is a State of Florida-chartered, Federally-insured financial cooperative. The credit union is regularly examined by the NCUA and the State of Florida, Office of Financial Regulation (OFR) to ensure that it operates safely and soundly, and does not engage in practices that would pose undo risk to the NCUSIF.
The strength of a financial institution is measured by its net worth. Until recently, little attention was paid to the net worth of individual financial institutions.
Starting in 1997, our Board of Directors - which is made up of elected volunteers who serve without pay - has worked alongside the credit union's management team to carefully build SCCU's level of net worth since 1997. This ensures that credit union has adequate reserves to weather economic downturns such as the one being experienced now.
The NCUA considers a credit union adequately capitalized at 6% net worth to assets. Space Coast Credit Union currently maintains a net worth at twice that level. SCCU is well-positioned not just to weather the storms of uncertainty and disruption, but to be strong enough to flourish and continue to provide needed financial services to our community.
The credit union undertakes reasonable risks to provide home loans, and other loans, for its members. Sub-prime lenders undertook unreasonable risks, providing unaffordable loans in order to drive short-term returns. When the values of the homes dropped, the whole sub-prime house-of-cards collapsed.
Further, these sub-prime loans were packaged as securities and sold as high-yield investments called CDO's, which became devalued as the loans upon which they were built failed to perform. This devaluation has caused huge losses and write-downs at those institutions who participated in these investments. The credit union never participated in such investment vehicles to support aggressive growth strategies, and therefore was not negatively impacted by the collapse of these investments.
Because the credit union is literally made up of the communities it serves, it is affected by the economic downturns that affects these communities. So when one of our neighbors defaults on a mortgage, if the credit union provided them the home loan, the credit union and its members are affected by any losses that might occur. However, because the credit union did not engage in sub-prime mortgage practices, nor invest in them, our loans are not subject to the level of losses being experienced by the financial institutions making the headlines.
The credit union has been growing with our community for 57 years. The growth has been slow by some perspectives, but the Board and management have not focused on growth, but rather on excellence. We have focused on substance over appearance; on strength rather than flash and on long-term member value over short-term returns. We have not, and will not, put our members' assets at risk in order to attain short-term profits.
As the bad news about many other financial providers continues to emerge, I not only provide my assurance of the strength and soundness of the credit union, I invite you to look further into the things that truly set the credit union apart. The credit union has continued its steady growth this year amidst all of the turmoil because our values are different from financial institutions that exist to generate profits for investors and the stock market. This difference is now very apparent.
Available to our Communities
Membership in Space Coast Credit Union is open to all those who live or work in Brevard, Volusia, Flagler, Indian River, Seminole, Osceola, and Orange Counties.
We invite our neighbors who are not currently members to participate in this member-owned cooperative. We exist only to serve the long-term interests of our members. This is what we do well, because this is all we do.
Douglas R. Samuels
SCCU Member since 1991
Connections, January 2008
Doug Samuels, President/CEO, provides his perspective as to how character relates to business practices, and how SCCU's character influences service to members
Connections, April 2008
Doug Samuels, President/CEO, provides his perspective on SCCU priorities in providing service to members
Connections, May 2008
Tom Decker, VP of Financial Services, provides his perspective on current economic conditions and suggested member actions
Connections, July 2008
Doug Samuels, President/CEO, provides information on ways that SCCU can help members to attain financial self-sufficiency