Very High CD Rates at Christian Community CU in California - Easy Membership but ASI-Insured Only

 Christian Community Credit Union continues to offer very high certificate rates. In fact these rates are so high compared to the competition, that it's a little worrisome especially since this credit union only has private insurance via American Share Insurance (ASI). Nevertheless, it is a legitimate credit union that's licensed as a California state chartered credit union. I leave it up to you to make your own decision about their safety. I'll provide as much information as I can to help you decide.

The very competitive rates are being offered in their special certificates called Kingdom Builder Certificates. Minimum deposit is $1,000, and the money must be new to the credit union. The rates include a 4.50% APY for terms of 7 to 18 months and a 5.00% APY for terms of 24, 36, 48 and 60 months. These rates are listed in the credit union's Kingdom Builder Certificates page as of 1/03/09. There's also an image of these specials on the credit union's front page with a link to this page.

The standard CD rates are more inline with the competition.

I last contacted this credit union in May 2008. I was told that you cay apply for membership, open these special certificates and fund them electronically. Their online application uses Andera which is common for many online banking applications. The online application states the following limit: "You may fund these products by using your Checking or Savings Account up to a limit of $51200." This is shown as a popup on the page where you select the accounts to open.

Membership is open to those who affirm a personal Statement of Faith. Please see their Membership page for more details.

The credit union has offices in San Dimas and Covina, California.

Safety and Soundness of Christian Community Credit Union?

I found the credit union's review of its financial shape interesting. The page is titled "Your Money is Safe, Sound and Invested in a God-Honoring Way."

Christian Community Credit Union still has a 3-star rating (performing) at Bankrate.com based on 9/30/08 data. BauerFinancial gives them a non-rating (I'm not sure why).

California has them listed in their Directory of State Chartered Credit Unions.

As I mentioned above, the credit union only has private insurance via American Share Insurance (ASI). I have more discussion on ASI, in the April 2008 post.

Like the NCUA, the ASI does provide access to each credit union's financial data. Here's the ASI page for this credit union.

Soundness of Private Deposit Insurance?

This old 1991 NY Times article does not discuss ASI, but another private credit union insurer that covered Rhode Island credit unions. There's an interesting quote that's relevant to the issue of ASI.

"The private insurance funds are well intentioned, but they are fundamentally flawed by inadequate capital and the lack of a sound reinsurance policy," said Bert Ely, a banking consultant and an expert on deposit insurance in Arlington, Va. "Anytime one of their large insured institutions fails, they have shown a lack of staying power."

I can't say how ASI will hold up if our financial crisis worsens. You'll have to make that decision yourself.

Via: Very High CD Rates at Christian Community CU in California - Easy Membership but ASI-Insured Only