WASHINGTON — Deposits in credit unions would be temporarily insured up to $250,000 and credit unions, banks and thrifts would be able to sell their illiquid assets to the government under the bill passed by the Senate last night by a vote of 74-25.
The bill increases the amount of credit union and bank deposits covered by federal insurance from $100,000 to $250,000 through the end of 2009. Credit unions won't be assessed a higher fee for the additional coverage. The NCUSIF will see its line of credit from the Treasury Department increase.
The House–which rejected a similar measure on Monday–is scheduled to vote on the Senate-passed bill on Friday.
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Increasing the amount of money that is insured was seen as a way to pick up more support for the $700 billion plan to authorize the government to buy the troubled assets from credit unions, banks and thrifts and also increase consumer confidence. The Senate also included an array of tax incentives.
CUNA and NAFCU both issued statements praising the Senate's action and vowed to work to ensure that the House version also contains the same protections for credit unions.
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