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  1. Hi Catherine
    We belong to an Orlando credit union,
    FairWinds and were considering moving more money into it for increased safety. Recently, they bought Citizens National Bank of Oviedo FL.

    I thought banks and credit unions were two separate banking vehicles. Can you explain this to me…also do you think this credit union is safer than one that is purely a credit union and not a hybrid.?

    Thanks
    Donna Fraser

  2. Hi Catherine, Thank you for providing these questions. I am not clear on terms like naked short selling, Bear raids etc. I would also have a difficult time determining how to evaluate the bank’s responses.

    Thank you for all the work you do!

  3. Hi Catherine – I connected with a new Bank and have asked for info like you suggest. Here is what I received. While I realize this is a public forum, they did send this to me, so I thought it would be okay to post here. Plus I thought it might help others. What do you think about this Bank? It looks good to me but I wanted you to weigh in.
    ——————————–
    Thank you so much for your inquiries earlier this week about Bell Bank and how safe your deposits will be with us. Below are some reassurances on why your deposits are safe with Bell Bank:
     
    ·         We are all benefited by the swift action taken by the FDIC and Federal Reserve over the weekend to support banks and help prevent any type of “run on the banks” contagion that could have impacted the entire banking industry.
    ·         The failed banks (Silicon Valley Bank and Signature Bank) both had some very unique attributes (crypto/tech sector exposure, large bond portfolios, concentrated deposit bases) that exposed them to catastrophic trouble as interest rates rose. Bell Bank does not share those attributes.
    ·         Our bank has virtually no nonperforming loan issues and is well capitalized – and we are strengthened by the fact we have no debt at our holding company.
    ·         Bell Bank has a very diverse deposit base. While both SVB and Signature reportedly had the vast majority of their deposits in uninsured accounts, Bell Bank (like most of our community bank peers) has nearly 90% of our deposits insured by the FDIC, which creates great stability. We also have excess liquidity on our balance sheet.
    ·         Perhaps our greatest strength: Bell Bank is privately owned and therefore not subject to sudden downward price movements that can cause capitalization shortfalls for publicly traded banks.
     
    See below for quantitative reassurance on our asset quality:
     
    ·         Bell Bank maintains an asset structure centered in a diversified loan and lease portfolio. As of 12/31/22:
    o   Loan and lease portfolio represents 87% of total assets, investments represent 8% (zero cryptocurrency exposure), other assets represent 5%.
    o   Loan and lease portfolio composition consists of 43% commercial real estate, 27% residential real estate, 18% commercial & industrial loans, 12% agricultural and other loans. 
    o   No loan/lease categories exceed regulatory concentration thresholds.
    ·         Bell Bank has maintained strong asset quality and outperformed industry peers both currently, and throughout the Great Recession.
    o   The following metrics are contained in the Bank’s publicly available Uniform Bank Performance Report (UBPR) – full report can be accessed here:  FFIEC UPBR Reports

     Although we expect some continued market volatility and macroeconomic uncertainty as we move forward, Bell Bank remains well-capitalized, financially strong and positioned well for long-term success.

  4. Thank you Catherine for your insights. I have been following your YouTube interviews for a few years and because of you I began preparing over 2 years ago. Now, I just have to sort out a better banking system here in UK.

  6. Hello Catherine. I didn’t want this to go under the radar, as it could be important regarding Credit Unions. On twitter of all places, the NCUA posted this message
    “ The NCUA seeks a talented Attorney Advisor (General) responsible for legal research on operational matters of federally insured credit unions, including federal regulations and legislation affecting the NCUA and financial services industry. https://go.ncua.gov/3lNW9dn “
    Do you know of any laws, or regulations that could be in the works for changing the way Credit Unions asre structured? I hope I’m merely over suspicious.
    Just as a FYI, the U.N. actually has their own CU membership too. Hoping They won’t be recommending Attorney Advisors

    1. Tons of Laws related to new regulation,including crypto and money laundering, FedNow and CBDC

  7. These questions are great. However, I need the other side of the equation as well. I would appreciate some guidance on how to evaluate the answers I get. I am an economic layman and I am not confident that I would be able to understand their answers.

    1. Phyllis – Thank you for saying this. I am worse — a complete ignoramus, who barely understands the questions. For example, I thought all deposits were insured (Q#2).
      Catherine – I subscribed to Solari because I want to support you and your work and because I want to learn. I don’t expect you to teach me, but I wonder if you would be willing to create a section called Money 101 with various articles you would recommend for dummies, I mean, novices, like myself.

  8. hi catherine im poor single grandmom and saved my stimulus monies a lil over 3k and dont wanna loose it in a dollar crash…saved hoping to move out of CA but cant find safe sec8 housing elsewhere could you tell me please what to do with my moving money so it doesnt disintegrate into nothing?

    1. Sorry, I’m not Catherine, but we’re rather in the same predicament. With limited amounts of money as such, the best you can do is make sure you have enough food (like freeze dried long term), small garden if possible & good water supply and maybe buy some junk silver to preserve a bit of cash (Treasure Island Coins is one place).

  9. Hi Catherine, all,

    You really DO NOT NEED TO WORRY, UNLESS YOU ARE GOING TO DO BUSINESS WITH YOUR ACCOUNT THAT IS GREATER THAN THE DEPOSIT INSURANCE LIMIT OF $250,000.

    Moreover, remember the CAMEL rating. This is an acronym that stands for capital adequacy, asset quality, management quality, earnings condition and robustness, and liquidity availability. You can ask bank management for its CAMEL rating. Even if the bank or other type of financial institution is relatively small, under perhaps $500mm in assets, it may be a bank with stock that is publicly traded. In that case it will have Annual and perhaps even quarterly reports it must file with the SEC. If one is to be a depositor, of deposits greater than the deposit insurance limit, (over $250,000) and this is in substance different than an investor, as a depositor over the deposit insurance limit or an investor, you are presumed to be sophisticated and on behalf of your means, you need to do due diligence with your counter-party, in this case your bank.

    Virtually All banks and the former ‘thrifts’, referring to the savings & Loans, federal savings, and FDIC insured savings banks and mutuals in the past except for the reagan era with scherf/bush was the ‘thrift’ czar…. and he blew up that sector as we recall under reagan/volcker… but for virtually all financial institutions regulators produce a CAMEL from the quarterly call report that the financial institutions have to file, ie a quarterly regulatory report of their income statement, balance sheet, cash flow statement, subschudules of the (asset) quality of the loan portfolio, loan type, deposit and maturity of deposits, even schedules on asset/liability matching, capital adequacy, which the regulators (FDIC, former office of thrift supervision now rolled up into the office of the Comptroller of the Currency, which is embedded in the Treasury Department.

    These ‘CALL’ reports and the former TFRs, ie the Thrift Financial Condition reports were and are publicly available. What the regulators want to keep secret, they block or ‘redact’ in a way.

    In any single, even all banks are given a CAMEL rating of which 5 is the best and 1 is the worst. Banks with 4 or 5 tend to be public about this and if it’s 3 or below, then there are issues and it is easy to go to the FDIC and or Comptroller or FED websites and look up if there was a regulatory administered disciplinary action against the bank, such as a MOU, ie a memorandum of understanding, or a ‘written agreement’ or a cease and desist. All are administered with varying degrees of regulator ‘discipline’ ie slap on the wrist is the MOU, vrs demanding management change is the Cease & Desist.

    All your questions in effect still hang on what above i mentioned. my experience directly for years with these issues see here: https://apsoras1.wordpress.com/2017/05/16/andrea-psoras-resume-for-financial-sector-mergersacquisitions/ https://apsoras1.wordpress.com/category/professional-cv-resume-transactions-list-details/

    1. Clearly, better to not be in a bank that goes under. FDIC is not believed to be a timely pay.

      1. And credit unions or at least one of my credit unions does not participate in FDIC, they participate in NCUSIF, that is who insures their funds. Are you familiar with NCUSIF, Catherine? Can you take the time at some point to talk about NCUSIF?

        1. Recommend you check out the FDIC and NCUSIF websites and then discuss with your credit union how it works.

    2. The CAMEL ratings are not released to the public. Is there a way we can find out what they are for specific banks?

  10. Please see ICBA’s letter dated March 3, addressed to:
    Rachel Wallace
    Deputy General Counsel and Chief Operating Officer Office of Science and Technology Policy
    Executive Office of the President
    1650 Pennsylvania Avenue
    Washington, DC 20504
    RE: Request for Information – “Digital Assets Research and Development” (88 FR 5043)

    https://www.icba.org/docs/default-source/icba/advocacy-documents/letters-to-regulators/comments-on-digital-assets-research-and-development

    Thanks

  11. I recently sent a long letter (based on Carolyn’s bank letter – thank you)
    to our local bank here in Idaho. I sent hard copies to all the officers of the bank and the board of directors. So far the silence is deafening. So much for that. While the proposed questions for banks are great questions, I hardly think answers will be forthcoming (our bank is private) and they are obviously cagey around this issue. I did however, look up the national organization for community banks – Independent Community Bankers Association and found this:

    March 7, 2023
    The Honorable Tom Emmer U.S. House of Representatives Washington, D.C. 20515
    Dear Representative Emmer:
    On behalf of community banks across the country, with nearly 50,000 locations, thank you for introducing the Central Bank Digital Currency Anti-Surveillance State Act (H.R. 1122), legislation to prohibit the Federal Reserve from offering products or services directly to an individual, maintaining an account on behalf of an individual, or issuing a central bank digital currency directly to an individual.
    ICBA adamantly opposes the direct provisioning of retail deposit accounts by the Federal Reserve known as “FedAccounts.” FedAccounts would compete directly with checking and savings accounts offered by community banks and raise serious privacy concerns, as they could potentially be used by the government to track consumer financial transactions.
    A central bank digital currency (CBDC), under consideration by the Federal Reserve and the Biden Administration, presents many of the same objections as FedAccounts. Notably, it would directly compete for bank deposits that fund lending. Any type of direct-to-consumer CBDC could create an outflow of deposits from community banks with an adverse impact on credit availability.
    Thank you for introducing H.R. 1122, which would prohibit both FedAccounts and a direct-to-consumer CBDC. ICBA is pleased to support this important legislation.
    Sincerely, /s/
    Rebeca Romero Rainey President & CEO

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