As of October 14, 2008, all non-interest bearing transaction deposit accounts at an FDIC-insured institution, including all personal and business checking deposit accounts that do not earn interest, are fully insured for the entire amount in the deposit account. This unlimited insurance coverage is temporary and will remain in effect for participating institutions until December 31, 2009.
The insurance coverage on non-interest bearing transaction accounts is over and above the $250,000 in coverage provided to a customer already. For example, if a customer has $500,000 in a non-interest bearing transaction deposit account and $250,000 in a certificate of deposit, the FDIC would fully insure the entire $750,000.
On October 3, 2008, FDIC deposit insurance temporarily increased from $100,000 to $250,000 per depositor through December 31, 2009.
The Federal Deposit Insurance Corporation (FDIC) is an independent agency of the United States government that protects against the loss of insured deposits if an FDIC-insured bank or savings association fails. FDIC deposit insurance is backed by the full faith and credit of the United States government. Since the FDIC was established, no depositor has ever lost a single penny of FDIC-insured funds.
FDIC insurance covers funds in deposit accounts, including checking and savings accounts, money market deposit accounts and certificates of deposit (CDs). FDIC insurance does not, however, cover other financial products and services that insured banks may offer, such as stocks, bonds, mutual fund shares, life insurance policies, annuities or municipal securities.
There is no need for depositors to apply for FDIC insurance or even to request it. Coverage is automatic.
To ensure funds are fully protected, depositors should understand their deposit insurance coverage limits. The FDIC provides separate insurance coverage for deposits held in different ownership categories such as single accounts, joint accounts, Individual Retirement Accounts (IRAs) and trust accounts. Deposits accounts owned by corporations, partnerships, unincorporated associations, employee benefit plans and government entities also are covered by FDIC.
Basic FDIC Insurance Coverage Limits
| Single Accounts (owned by one person) |
$250,000 per owner** |
| Joint Accounts (two or more persons) |
$250,000 per co-owner** |
| IRAs and certain other retirement accounts |
$250,000 per owner |
| Trust Accounts |
$250,000 per owner per beneficiary
subject to specific limitations and requirements** |
Corporation, Partnership and
Unincorporated Association Accounts |
$250,000 per corporation, partnership or unincorporated association |
| Employee Benefit Plan Accounts |
$250,000 for the non-contingent,
ascertainable interest of each participant |
| Government Accounts |
$250,000 for the non-contingent,
ascertainable interest of each participant |
* These deposit insurance coverage limits refer to the total of all deposits that an accountholder (or accountholders) has at each FDIC-insured bank. The listing above shows only the most common ownership categories that apply to individual and family deposits, and assumes that all FDIC requirements are met.
** The legislation authorizing the increase in deposit insurance coverage limits makes the change effective October 3, 2008, through December 31, 2009.
If you have questions about FDIC coverage limits and requirements, please visit www.myFDICinsurance.gov, call toll-free 1-877-ASK-FDIC, or ask your branch representative.
Back to top
Dear Customer:
During these troubling economic times, we at Salisbury Bank are here for you - as we have been for the last 160 years. This summer, we sent you a letter reviewing the financial soundness of Salisbury Bank. We appreciate the positive feedback from so many of you.
We continue to remain solid and strong with a high quality asset base, low level of non-performing loans and adequate allowance for loan losses which help to sustain our earnings stream in uncertain times. In addition to asset quality, our capital ratios are exceptionally strong and exceed all regulatory requirements needed for the Bank to be considered "well capitalized."
Prudent management, quality assets and a strong capital base are strengths that have enabled Salisbury Bank to serve our customers and communities since 1848. These same qualities are critical to success in the current economy and continue to contribute to the Bank's financial strength and stability. We want to assure you that we stand ready to provide solutions to your financial needs and answers to your financial questions.
In an effort to keep you informed about the turbulent financial markets and to assist you in protecting your financial well-being, we would like to share some advice which we believe you will find helpful as we all weather the current financial storm.
In the September 16, 2008 issue of the Wall Street Journal, we saw an article titled, "TenWays to Protect Your Finances from the Crisis." Author, Brett Arends outlined a "game plan to minimize the danger" of the current volatile market. We've summarized a few of his key ideas below:
1. Check that your bank accounts are federally insured.
While the basic FDIC insurance coverage is $100,000 per depositor per insured bank, certain accounts, such as Individual Retirement Accounts, are insured up to $250,000.You may also qualify for more coverage if you have your deposit accounts in different ownership categories. Please call us to find out more.
Salisbury Bank can also provide additional insurance coverage to certificate of deposit account holders through the Certificate of Deposit Registry Service, or CDARS®, a perfect solution for those of you that have your CDs spread between several banks in order to protect your assets. With CDARS, you sign one agreement, get one statement and bank with Salisbury Bank for all your CD deposits. This saves you from multiple rate negotiations, tracking several CDs and interest disbursements, and monitoring changing collateral values. CDARS will save you valuable time and money, while providing maximum FDIC protection.
2. Put money in your purse.
Benjamin Franklin once said, "A penny saved is a penny earned." Now is the time to review your family budget for hidden savings. keep your car an extra year, schedule a home energy audit, cancel premium cable channels, review your cell phone plan, and invest those savings in a federally insured account.
3. Set up a home equity line of credit while you still can.
Usually advising people to take on more debt is not ideal, but if access to ready cash might be a lifesaver, it's best to line it up, particularly if you are anticipating a job cut.
4. Refinance your mortgage.
Fixed rate mortgages are quite attractive; consider refinancing those adjustable rate loans.
5. Don't panic.
We know that it is difficult to remain optimistic amongst the dreary daily market reports. The media by its nature, maximizes the negative news. Ask us for solid answers to your questions.
6. When it comes to your short-term money needs, nothing has changed.
The money you might need within the next year or two should be held in cash or equivalents. The stock market is no home for money you may need urgently; it's too volatile. Certificates of deposit are paying competitive rates right now and are federally insured.
Please feel free to call either of us or visit your branch manager to find out how Salisbury Bank can help you prepare for a secure future. We're here for you.
Sincerely,
John F. Perotti Richard J. Cantele, Jr.
Chief Executive Officer President and Chief Operating Officer
Funds may be submitted for placement through CDARS only after a depositor enters into the CDARS Deposit Placement Agreement with us. The agreement contains important information and conditions regarding the placement of funds by us using CDARS. CDARS is a registered service mark of Promontory Interfinancial Network, LLC.
Back to top
Dear Customer:
These are uncertain economic times for many Americans. People are worried about their jobs, rising energy costs and the volatility of the stock market. On a daily basis we read reports of the national subprime mortgage crisis, foreclosures and credit quality concerns. In these times, we are reminded of the wisdom expressed years ago by Will Rogers when he said, "I am more concerned about the return of my money than the return on my money."
The relevance of such observation was demonstrated earlier this month when the Federal Deposit Insurance Corporation (the "FDIC") was faced with the failure of the IndyMac Bank, which represented one of the largest bank failures on record. Despite that bank's failure, none of that bank's 200,000 customers lost a single penny of their FDIC-insured deposits. In fact, since the creation of the FDIC in 1933, no depositors have lost any money on an FDIC-insured deposit.
As a customer of Salisbury Bank and Trust Company, we think it is important for you to know that for 160 years, your bank has remained dedicated to the prudent protection of the assets that our customers entrust to our care. We have consistently applied sound and conservative underwriting practices. Our loan quality remains strong with nonperforming loans representing less than one percent (1%) of our total loan portfolio. Our high quality loan base, and our prudent allowance for loan losses help to sustain our earnings stream in uncertain times.
In addition to asset quality, capital adequacy has long been considered to be a measure of a bank's safety and soundness. In this regard, our capital ratios are exceptionally strong and substantially exceed all regulatory requirements needed for the Bank to be considered "well capitalized".
Prudent management, quality assets and a strong capital base are strengths that have enabled Salisbury Bank and Trust Company to serve our customers and communities for 160 years. These same qualities are critical to success in the current economy and continue to contribute to the Bank's financial strength and stability.
In recent weeks, many new and existing customers have recognized the value and security of an FDIC-insured deposit at Salisbury Bank and Trust Company and have established new accounts or increased their deposits with us. We appreciate the confidence our customers place in us. While the basic FDIC insurance amount is $100,000 per depositor per insured bank, certain accounts, such as Individual Retirement Accounts, are insured up to $250,000. You may also qualify for more than the standard coverage if you have deposit accounts in different ownership categories. Finally, Salisbury Bank and Trust Company can provide additional insurance coverage to certificate of deposit account holders through the Certificate of Deposit Registry Service or CDARS (pronounced "cedars"). Through CDARS, Salisbury Bank and Trust Company can offer a way to increase your deposit insurance protection, for deposits up to $50 million. Please contact any of our Customer Service Representatives or visit our website at www.salisburybank.com, click on financial tools, and then click on financial links, or see our press release dated July 14, 2008 on our website.
If you should have any questions or if we can be of any assistance to you, please do not hesitate to contact us at (860) 435-9801.
Sincerely,
John F. Perotti Richard J. Cantele, Jr.
Chief Executive Officer President and Chief Operating Officer
Back to top