Depository institutions, commonly known as banks, provide multiple financial services including banking, savings, loans, and insurance. They include commercial banks, credit unions, and savings and loan associations. These institutions are regulated and offer services like interest-bearing accounts, loans, credit cards, safe deposit boxes, and financial counseling. Depositors' accounts are insured by agencies like the FDIC and NCUA up to $250,000 to protect consumers from loss of funds if an institution fails.

1. Depository Institutions Take Charge of Your Finances 1.7.3

2. Depository Institutions (Most commonly known as “banks”) Depository Institutions – businesses which offer multiple services in banking and finance These institutions include: Banks Savings and Loans Credit Unions They are regulated by various state and federal agencies

3. Depository Institutions

4. Services include: Federal Reserve Bank

5. Federal Reserve Bank Which federal reserve bank is located in your region?

6. Life of a Deposited Check

7. Depository Institutions Commercial Bank Credit Union Savings and Loan Association

8. Commercial Bank Commercial Banks Usually the largest depository institutions Considered full-service depository institutions Available to a variety of consumers Examples – Wells Fargo, US Bank, Chase Bank

9. Credit Union Credit Unions Non-profit cooperative depository institution Owned by members who share a common bond Examples – State Employees Credit Union, Teachers Federal Credit Union

10. Savings and Loan Association (S&Ls) Savings and Loan Association Focus on providing loans and mortgages Customers must have a savings account with them Examples – American Federal Savings Bank, Pioneer Federal Savings & Loan.

11. Types of Insurance Federal Deposit Insurance Corporation (FDIC) Federal government agency which protects depository institution accounts Insures commercial banks and savings and loan associations National Credit Union Administration (NCUA) Provides insurance for credit unions

12. Insurance Protection Insurance protection Each depositor is insured up to $250,000 for money deposited in a regular account and $250,000 for retirement deposits Available from both FDIC and NCUA Insurance is important because of the risk of loss Risk of Loss is used to determine which party should be responsible for damage or loss of products after a service transaction has been completed but prior to delivery

13. Interest Interest - the amount of money that is either gained or lost when accessing services offered by a depository institution Interest rate - the percentage used annually to calculate the total interest either gained or lost Type of account Interest rate Impact on the consumer Interest bearing - money earned from an investment instrument High More money earned by the consumer Low Less money earned Interest bearing - the charge for money that a consumer borrows from a depository institution High More money paid by the consumer Low Less money paid Credit unions typically offer rates which have the most positive impact on the consumer

14. Depository Institution Services

15. Common Services Offered

16. Interest Bearing Accounts

17. Interest Bearing Accounts Credit Card A card used to make a purchase now and repay later If the balance is paid before the grace period ends, interest is not added If the balance is paid after the grace period, the payment of interest is required Loan Money borrowed and paid back with interest Mortgage – loan for a home Personal – interest rates vary depending upon type of loan Loan types can include vehicle, school, etc.

18. Additional Services Which May Be Offered Safe-Deposit Box A secured box in a bank to be used for valuable and important personal items. Financial Counseling Information and advice is given to customers to help make financial decisions.

19. Conclusion and Review