As Prepared for Delivery on September 21, 2023
Thank you, Mr. Chairman. Thank you, Eugene, and staff for your work on this.
Firstly, I would like to highlight the continuous growth of the credit union system at large. Federally insured credit unions have added over 5 million members since the second quarter of 2022. Insured shares have grown by $31 billion, or 1.8 percent, to $1.72 trillion. The NCUA’s National Credit Union Share Insurance Fund remains strong and protects about 91 percent of these deposits.
Last year, the NCUA decided to increase the percentage of investment in overnight funds. Now, the Fund has close to $4 billion in overnight funds earning over 5 percent.
Once this goal is met, the Share Insurance Fund’s investment strategy will be reevaluated, especially as the rate environment may change towards the year of the year. But for now, the Fund is taking advantage of high short-term rates. We’re sellers of money, and prices are high.
As a reminder, credit unions have access to a wide range of liquidity sources. The small credit unions out there may not have liquidity options set up, so I implore those institutions to seek out liquidity options. Talk to your examiner, talk to your league, talk to your corporate credit union.