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Worried About The Safety
of Your Money?
Deposits Are Safe at
a Community Bank
By Gary W. Gray
President & CEO, CRBNA
See About Us/Bank News |
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Worried About The Safety
of Your Money?
Deposits Are Safe at
a Community Bank
By Gary W. Gray
President / CEO
Connecticut River Bank, N.A.
CHARLESTOWN NH - Even though headlines report huge financial losses, large banks experiencing turbulence and chaos in the markets, you can rest easy knowing your deposits are insured. The Independent Community Bankers of America (ICBA) and Connecticut River Bank, N.A. remind community banking customers that their insured deposits are safe and backed by the full faith and credit of the federal government through the Federal Deposit Insurance Corporation (FDIC) at your local community bank.
“We understand that during these difficult economic times some people are concerned about the safety of the money they have in their bank savings or retirement accounts, but they shouldn’t be,” indicated John Hoyt, Senior Vice President and Head of Deposit Operations at Connecticut River Bank. “The federal government has insured their funds held in an FDIC-insured community bank for up to $100,000 and $250,000 for certain retirement accounts.” Also, through a service called CDARS (pronounced “cedars”), Connecticut River Bank, N.A., and other banks in the network, can offer you up to 500 times the standard $100,000 level of coverage found at most banks.
Since the FDIC was created in 1933, no one has lost a single penny in an FDIC-insured account. Because of FDIC insurance, four generations of Americans have been able to sleep soundly at night knowing that their money is fully protected. Now with CDARS, depositors can be protected for up to $50 million, and that means that you too can sleep soundly without worrying about your money. CDARS is a deposit placement service. Deposits placed through CDARS meet the pass-through insurance coverage guidelines established by the FDIC.
To offer CDARS, a bank must belong to a special network called the Promontory Network. When a customer places a large deposit with a Network member, the bank arranges for the placement of funds into CDs issued by other Network banks – in increments of less than $100,000 to ensure that both principal and interest are eligible for full FDIC protection. “Community banks are stable and well-capitalized,” said Cynthia L. Blankenship, ICBA chairman and vice chairman and chief operating officer of Bank of the West, Irving, Texas. “In spite of the headlines about the challenges facing Wall Street financial institutions, community banks are open for business and our customers can bank with confidence knowing their money is safe because it is insured by the FDIC.
The FDIC insures deposits and protects depositors' funds in banks and savings associations. FDIC deposit insurance covers each depositor's account, dollar-for-dollar, up to the insurance limit, including principal and any accrued interest. Customers should look for an official FDIC sign at each teller window or teller station in their local community bank to know their institution is covered by FDIC insurance.
According to the FDIC, insurance covers all types of deposits received by a financial institution in its usual course of business, including savings and checking accounts, NOW accounts, Christmas club accounts, and time deposits like certificates of deposit. Cashiers' checks, officers' checks, expense checks, loan disbursement checks, interest checks, outstanding drafts, negotiable instruments and money orders drawn on the institution are also considered deposits, and are protected by the FDIC.
“If you are having difficulties managing your finances, talk with your local community banker. Community banks are here to serve our communities,” said Blankenship. “Our relationships with our customers are very important to us. We want to keep our customers for the long-term.”
About ICBA
The Independent Community Bankers of America, the nation’s voice for community banks, represents nearly 5,000 community banks of all sizes and charter types throughout the United States and is dedicated exclusively to representing the interests of the community banking industry and the communities and customers we serve. For more information, visit www.icba.org.
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