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Depository Institutions. Commercial Banks, Savings Institutions and Credit Unions. Depository Institutions. Depository institutions are financial institutions whose major source of funds are deposits.
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Depository Institutions Commercial Banks, Savings Institutions and Credit Unions
Depository Institutions Depository institutions are financial institutions whose major source of funds are deposits. Deposits are borrowings by banks in return for periodic interest payments (except for certain demand deposits that pay no interest).
FDIC The Federal Deposit Insurance Corporation, formed in 1934, insures customer deposits up to $100,000.
Depository Institutions Three main types of depository institutions: • Commercial Banks • Savings Institutions • Credit Unions Main activity is to accept deposits and make loans.
Commercial Banks Nationally chartered banks are members of the Federal Reserve System. State chartered banks have the options to choose membership within the Federal Reserve System.
Savings Institutions Two basic types of savings institutions: • Savings & Loans Associations • Savings Banks Both make residential mortgage loans and accepts deposits, however, savings banks also make commercial loans, leases and other forms of financing. Insured by the FSLIC (Federal Savings and Loans Insurance Corporation)
Credit Unions Depository institutions owned by members of a common group (i.e. teachers) Credit unions provide the same banking products as other banks however, they only service their members. Credit unions are treated as non-profit organizations. Insured by the NCUSIF (National edit Union Share Insurance Fund) and supervised by the National Credit Union Administration (NCUA).