Thursday Update: Bailout Clears Senate; Another Credit Union ClosesTwo days after the House narrowly rejected the Bush Administration's proposed $7 billion financial market bailout, the U.S. Senate on Wednesday approved an amended version of the bill.
By a 74-25 vote, the Senate gave thumbs-up to an aid package that includes new "sweeteners" to attract House critics - i.e. middle class and corporate tax breaks, as well as a one-year increase in the federal insurance on individual bank deposits from $100,000 to $250,000.
"An end to the crisis is now in sight," said Senate Majority Leader Harry Reid, a Nevada Democrat, after the bill's passage.
"This is not a piece of legislation for lower Manhattan," Reid added. "It's a piece of legislation for all Americans." The bill now returns to the House, which is expected to take action within the next several days.
Market is Cautious
The financial market continues to watch this situation nervously. After losing 777.68 points on Monday - the largest one-day drop in history, the market gained back nearly 500 points on Tuesday, and then on Wednesday lost only 19.59 points, as investors waited for the Senate vote.
11th Credit Union Closed
And while there have been no further seismic activities on the scale of last week's failure of Washington Mutual and Monday's takeover of Wachovia, the National Credit Union Administration (NCUA) did announce on Monday the liquidation of another credit union - the 11th such failure of 2008.
Kaiperm Federal Credit Union of Oakland, CA., was liquidated, and its assets were purchased by Alliant Credit Union, of Chicago.
Alliant Credit Union is a state-chartered, federally insured institution that began in 1935 to serve employees of United Airlines. It has $5.7 billion in assets, with more than 216,000 members throughout the U.S.
The NCUA opted to liquidate Kaiperm Federal Credit Union upon determining the institution was insolvent, with no prospects for restoring viable operations. Kaiperm, chartered in 1957 to serve employees of Kaiser Foundation medical facilities, had approximately $91 million in assets and served 18,000 members.