In Focus – SCCCU Blog

What happened with Silicon Valley Bank and Signature Bank?
Silicon Valley Bank was a bank that catered to a small concentration of technology companies in Silicon Valley. Perhaps 20 customers made a large majority of their deposits. When those customers started pulling their funds, the bank could not survive. No bank could in that situation.

• The bank’s loans originated in the tech sector, entrepreneurs, and venture capital firms.
• It's a niche bank serving a limited sector, thereby increasing its risk profile.
• Silicon Valley Bank deposits were heavily dependent on institutions rather than individuals.
• Very similarly, Signature Bank had a large portion of its deposit base centered around highly volatile cryptocurrencies.
• As a bank, SVB was subject to big-profit pressures from investors/stockholders (unlike many banks).

Could this also happen to Santa Cruz Community Credit Union?
Santa Cruz Community Credit Union is not a bank, and its model, philosophies, and operations are geared to support its member-owners; this model and the way we do business are significantly different from those of Silicon Valley Bank and Signature Bank.

• We are a community-based, member-owned, and community-development-certified financial cooperative credit union established 46 years ago by local people to support local needs.
• SCCCU prides itself on the unique service we offer you and follows the credit union model that ensures we lend member deposits back to our members.
• Our balance sheet is local and primarily comprised of auto, small business, and member real estate loans.
• Our investment portfolio is conservative and considered very safe by industry standards.
• In October of 2022, we passed our annual NCUA audit with no findings.
• Santa Cruz Community Credit Union is financially sound and well-capitalized.

What happens to my money if something similar happens to Santa Cruz Community Credit Union?
Santa Cruz Community Credit Union is a State-Chartered, Federally-insured, and regulated by the National Credit Union Administration (NCUA)—NOT associated with the Federal Deposit Insurance Fund (FDIC) for banks. Beyond ensuring that credit unions are solvent, the NCUA also insures member deposits under its National Credit Union Share Insurance Fund (NCUSIF).

How do I make sure that my money is covered by NCUSIF?
All member accounts are insured up to $250,000 by the National Credit Union Insurance Fund (NCUSIF), which is administered by the National Credit Union Administration (NCUA).

What if I have multiple accounts, how do I know if they are all covered?
You are always welcome to sit down with one of our Member Service Representatives and evaluate your deposits. There are ways to configure your deposits to ensure that separate accounts each have $250,000 insurance coverage. Credit union members have never lost a penny of insured savings at a federally insured credit union, and our industry’s deposit insurance fund has the backing of the full faith and credit of the U.S. government. See MyCreditUnion.gov for more information.

The National Credit Union Administration provides a Share Insurance Estimator that can be used to determine coverage across all account and ownership types.

SCCCU values you, our members, and we understand that these are difficult times. We are here to help. Please visit any of our branches or call our Member Service Center at 831-425-7708.