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Email this5:42 pm
I was wondering if anyone has dug some digging into the Manitoba Credit Unions and the CUDGC?
I know that the CDIC is pretty sounds and backed. But I've heard that the same is not true for Manitoba provincial one. Just how safe is it? Especially given that there is no deposit limit on the insurance, and that there seem to be lots of little CU's any of which could go belly up. I'd hate to throw my life savings into a Manitoba CU only to be returned with a timbit. ;-D
Mike.
2:00 am
This is the thread you're looking for: Provincial deposit insurance, Manitoba rates, etc
5:29 am
Thank you. I looked, but missed that one. So ultimately, theoretically not as secure as CDIC-backed but pretty darned secure.
Sounds also like it's better to invest in more than one if the insolvency of one is concerning.
I would imagine also that if one were concerned with a Manitoba credit downgrading, the ratio of provincial vs. non-provincial depositers might be a factor as locals would be less likely to run for the hills. lol.
Realistically I wonder if in a Manitopocalyptic scenario, the funds would first cover everyone to a certain base level, and leave large depositers hanging.
Mike.
6:46 am
Mike said:
I was wondering if anyone has dug some digging into the Manitoba Credit Unions and the CUDGC?
I know that the CDIC is pretty sounds and backed. But I've heard that the same is not true for Manitoba provincial one. Just how safe is it? Especially given that there is no deposit limit on the insurance, and that there seem to be lots of little CU's any of which could go belly up. I'd hate to throw my life savings into a Manitoba CU only to be returned with a timbit. ;-D
Mike.
Here is a question that I sent to a Money magazine.
Hi, I was just wondering about how secure my money, if deposited into GIC’s, at either Achieva Financial or Maxa Financial would be safe. Both companies appear to be spin offs from their Credit Union base in Manitoba. I guess that allows them to deal with all of Canada vs just Manitobans. Their GIC rates are good, to me, and would be excellent to ladder with. Any way, should I have any security deposit concerns??
Here is the response.
Secure
All your deposits are 100% guaranteed by the Credit Union Deposit Guarantee Corporation of Manitoba, with your account and personal information maintained under the strictest controls of Cambrian Credit Union, one of Manitoba’s largest credit unions.
I am from BC and what has happens here with CU's in trouble they are usually "taken over" by a stronger CU and is usually transparent to the user. I would imagine the same would happen in Manitoba.
Look at what one suits you the best for rates, service charges, and early redemption options. I only use the Manitoba CU's for savings and higher rates and NOT for day to day banking. No matter how much or how little money you have to put away to save....it is all precious and keep in mind NOT put all of your eggs in one basket.
I have had fantastic service from Accelerate and Outlook Financial.
8:47 am
You have to also remember that any deposit guarantee only takes effect upon the insolvency of the underlying institution. So...you should first look at the financial soundness of the financial institution you are depositing with as your first step of due diligence.
I deal with Achieva for over 10 years and have routinely reviewed Cambrian's annual financial report each year (Cambrian has been in operation over 55 years). Cambrian operates with a very low efficiency ratio, which is good and maintains strong profitability and a high level of capital to cover any potential financial shocks.
While I can not speak about all credit unions, I have done my own research and do know that no individual has ever lost a dime at a credit union in Manitoba. They also performed very well through one of the worst financial melt-downs since 1929.
8:33 am
One often hears calls to eliminate deposit insurance as a way to make banking competitive, but there's really no way a user can make decisions about the financial soundness of a bank or similar institution. By the time the news gets out, it's too late.
RetirEd
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