MADISON, Wis. (3/7/11)--Bill Hampel, chief economist at the Credit Union National Association, last week told readers of AOL’s Walletpop how to determine if a credit union is financially sound. Because many readers and financial experts have suggested that consumers join credit unions as an alternative to rising fees and fewer perks at many large banks, Walletpop asked Hampel what prospective credit union members should look for when considering a credit union. “The main thing is to check for deposit insurance,” he advised. “Ninety-nine percent are insured by the National Credit Union Administration (NCUA) which is equivalent to Federal Deposit Insurance Corp. (FDIC) insurance for a bank.” NCUA insurance protects credit union deposit accounts up to $250,000. Also, prospective members can ask about a credit union’s capital ratio, Hampel told Walletpop. According to their capital ratios, 96% of all credit unions fit or exceed the criteria for being well-capitalized, recent research indicates, Walletpop said. Also, Bankrate has an online tool that helps people evaluate the health of any U.S. credit union. Credit unions’ culture plays a major role in keeping them financially fit, Hampel said. “No credit union CEO or board member has any stock options, so they have a reduced incentive to take the risks that would make those stock options worth a lot of money,” he added. “They operate at a much lower risk level, and executives don’t get much of a reward for taking on risk.” To read the article, use the link.