Florida credit unions now can take part in $34 billion-plus state deposit program

Florida credit unions now can take part in $34 billion-plus state deposit program (Courtesy of the Jacksonville Business Journal) — Credit unions in Florida on May 2 got the ability to grow their deposits, thanks to a newly signed law.

Florida Gov. Ron DeSantis (pictured above) signed House Bill 989 at a ceremony in Jacksonville at VyStar Credit Union’s headquarters. The bill allows credit unions to become qualified public depositories, which can accept deposits from state agencies and departments along with institutions like universities and colleges.

Florida Chief Financial Officer Jimmy Patronis said at the event that about 119 banks were part of the public depositories program prior to the expansion. The program as of February 2024 includes more than $34.64 billion.

“Today marks a significant step forward in allowing credit unions to qualify as public depositories,” Larry Tobin, Fairwinds Credit Union president and CEO, said in an emailed response to Orlando Business Journal. “This pivotal decision not only expands the choices available to certain public entities, such as universities, but also reinforces the role of credit unions as trusted financial partners. By opening new avenues for deposit placement, this move provides greater financial flexibility and security for both credit unions and the public institutions.”

According to the League of Southeastern Credit Unions & Affiliates, Florida Treasury’s Bureau of Collateral Management now will create rules to oversee the program. Credit unions will have caps in the program, including:

• Not being able to hold more than 7% of the total funds held in the Florida Treasury.
• Not being able to hold more than 7% of all public deposits for a state college or university.
• Not holding more than 10% of its total assets as public deposits.

DeSantis said during a press conference at the bill signing that the goal is to open up options in addition to banks for state business. “If a credit union is going to give us a good deal, we want to be able to do business with them.”

Credit unions will be able to start applying on July 1

Florida has more than 119 credit unions, with a total of 7.4 million members and assets of more than $112.8 billion, according to the League of Southeastern Credit Unions & Affiliates.