Massachusetts Credit Union Share Insurance Corporation (MSIC) was chartered by a special Act of the Massachusetts Legislature in 1961. Formed as a primary insurer, MSIC was the first insurance company in the nation to provide deposit insurance protection to the members of credit unions. It is operated by a Board of Directors elected by and from the member credit unions it insures, which are, in effect, the owners of MSIC.
Massachusetts law is unique, as it requires full deposit insurance protection for the customers of Massachusetts cooperative and savings banks and members of state-chartered credit unions. Federal credit unions operating in Massachusetts may become a member of MSIC and provide MSIC’s deposit insurance to their members, but they are not required to do so by law. The current statute permits MSIC to insure deposit balances not insured by the federal deposit insurance program provided by the National Credit Union Administration (NCUA), in excess of $250,000, in both state and federal credit unions.
In its sixty-year history, MSIC has played a critical role in ensuring the stability of the credit union industry in Massachusetts. Over the years, the Corporation has wound up the affairs of liquidating credit unions (both voluntary and involuntary), temporarily managed and rehabilitated credit unions still independent today, assisted in the merger of failing credit unions into healthy credit unions, and provided capital assistance to several healthy but capital deficient credit unions, which allowed them to remain independent and obtain federal primary deposit insurance. While the Corporation has incurred losses (net of subsequent recoveries) of over $53 million in fulfilling its mission, no member of a credit union insured by MSIC has ever lost any of their savings or been denied access to their funds.
In addition to providing excess deposit insurance, the Corporation makes available a number of important services to strengthen its member credit unions and the industry: Custom Performance Reports (CPRs), which benchmark a detailed analysis of a credit union’s performance against a peer group; Board trainings and strategic planning sessions; educational seminars and workshops; an annual report on MSIC, its members and the Massachusetts economy; and Director Handbooks. In 2014, MSIC introduced the Liquidity Reserve Fund (LRF), a depository and lending facility created by Massachusetts law which allows MSIC to help transfer excess liquidity throughout the MSIC collaborative system.