Federal Government deposit guarantee
5 December 2008
All CUA savings and deposits up to $1 million per member remain guaranteed by the Federal Government free of charge.
CUA members with over $1 million in deposits now have a range of options available to them should they wish to have their savings guaranteed.
The Federal Government recently introduced a guarantee on all deposits with Australia’s credit unions, building societies and banks in response to the economic conditions currently being experienced in global financial markets.
The Federal Government announced that a fee would be payable to guarantee individual deposits in excess of $1 million from 28 November 2008.
CUA Acting CEO Robert Nicholls said members had the choice of whether or not to guarantee their savings over $1 million.
“We expect that the small number of members with over $1 million with CUA will understand that we are already in a very strong financial position,” Mr Nicholls said.
“CUA has no exposure to the American sub-prime market as we only lend to members who are all Australian based.
“We do not lend to large commercial or business corporations either, as our focus is on assisting individuals and small businesses.
“Furthermore, CUA has built up a strong capital position with over $500 million in member reserves which we believe is a prudent approach to managing the credit union through the current environment.”
Options available to members who want their deposits over $1 million to be guaranteed include;
- Members may be in a position to spread out their funds by allocating them across different memberships such as husband and wife or individual and company. Members should seek their own financial advice on whether this is appropriate for them.
- If members would rather keep all of their funds with CUA, they can pay the fee of 1.50% p.a. to have those funds fully guaranteed by the Government. The cost only applies to that amount in excess of $1 million.
For more information contact CUA on 133 282.
