Recent enhancements to FDIC insurance coverage have made bank deposits safer than ever. On October 3, 2008, the basic limit on federal deposit insurance coverage was temporarily increased from $100,000 to $250,000 per depositor. On October 14, the FDIC added a 100% guarantee for non-interest bearing deposits, like those for most business checking accounts. These enhancements will be in effect until December 31, 2009. Additionally, the FDIC has adopted an interim regulation that simplifies the rules for insuring the revocable trust accounts - commonly known as "payable on death accounts" (POD) and "living trust accounts". Among other things, the rule eliminates the requirement that beneficiaries must be "qualified," i.e., immediate family members: Beneficiaries may now be any person, charitable entity or other non-profit.  

FDIC Deposit Insurance Coverage

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 insurance.

Basic FDIC Deposit 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 per official custodian
Non-Interest Bearing Accounts	No limit, 100% guaranteed***

We welcome the opportunity to speak with you about the safety provided by FDIC insurance. Please call or stop by any of our branches.  You may also wish to visit the FDIC's web site for additional information or their insurance estimator at:

FDIC General Information: http://www.fdic.gov/news/news/financial/2008/fil08102a.html

FDIC Insurance Estimator:  http://www.fdic.gov/edie

* 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.

*** Virginia Commerce Bank is participating in the FDIC's Transaction Account Guarantee Program. Under that program, through December 31, 2009, all non-interest bearing transaction accounts are fully guaranteed by the FDIC for the entire amount in the account. Coverage under the Transaction Account Guarantee Program is in addition to and separate from the coverage available under the FDIC's general deposit insurance rules. This unlimited FDIC coverage for non-interest bearing accounts includes Interest on Lawyers Trust Accounts (IOLTA) and low-interest NOW accounts (defined as NOW accounts with interest rates no higher than 0.50 percent).