If you are questioning how secure NTLM is then I would suggest that you have far, far larger issues to worry about in your enterprise than merely the security of a list!
SharePoint's security model is pretty solid and has been tested countless times both in Intranet sites as well as Internet sites without any major failing so that should not be an issue. If you are concerned about list access itself, the list can be secured to so that only members of either a SharePoint group or an Active Directory group have access. Naturally, Site collection administrators can still see everything but if you are worried about that, then you can also enable auditing in order to keep tabs on who is accessing what and when. If you are still worried about SCA access then you can isolate the list in its own Site Collection and restrict the list of Site Collection Admins there.
A common alternative is to keep the passwords in an Excel file and then Zip that file with a password. It is not intuitive or easy to manage nor does it allow any of the standard SharePoint functionality but it does give you a second layer of security.
You also might be able to put a OneNote into a SharePoint library with the passwords and password protect it. This eliminates the utility of SharePoint list and view functions but would add the benefit of offline synchronization. This is easier than Excel but not all organizations have embraced OneNote so there is sometimes a learning, deployment or acquisition curve.
