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The erosions of Silicon Valley Bank, Signature Bank, and most recently First Republic Bank, left many deposit holders across the country wondering … “Are my funds safe?”

At Park Bank, our short answer is: “Yes.”

But there’s more to it than that. We understand if the big bank closures made you raise an eyebrow, and we certainly don’t take your concerns lightly. So, let’s go over why your deposits are safe at Park Bank in greater detail.

For starters, we are rated as a 5-Star Bank by Bauer Financial, the highest rating a bank can receive. Bauer Financial star ratings classify each institution based upon a formula that factors in current and historical data. The first level of evaluation is the institution’s capital level, followed by (but not limited to) profitability, historical trends, loan delinquencies, repossessed assets, regulatory compliance, proposed regulations, and asset liquidity.

As an FDIC-insured bank, here’s what you need to know about FDIC insurance and Park Bank’s commitment to keeping your funds safe.

Let’s begin with the basics.

FDIC Insurance Background

According to its website, “The FDIC (Federal Deposit Insurance Corporation) is an independent agency of the United States government that protects bank depositors against the loss of their insured deposits in the event that an FDIC-insured bank or savings association fails. FDIC insurance is backed by the full faith and credit of the United States government.”

FDIC insurance was created in 1933 during the Great Depression after many bank failures led to widespread panic and runs on banks. The insurance was designed to restore confidence in the banking system and prevent future losses. Today, FDIC insurance covers depositors up to $250,000 per depositor, per insured bank, in each account ownership category (more on this in a moment). This means that if a bank fails, the FDIC will reimburse depositors up to the insured amount for each account they hold at the bank. Premiums paid by banks fund FDIC insurance and do not require any action or payment from depositors.

Now, you might be wondering, what does “a run on the bank” mean?

Essentially, a “run on the bank” can happen at a financial institution when many of its depositors withdraw all (or a large amount) of their money for fear of losing it. As more depositors withdraw their funds, the chances of default increase which can cause more people to take out their deposits. In severe cases, the institution’s reserves may not have sufficient resources to cover the withdrawals.

This can happen when a financial institution hasn’t adequately evaluated risk in its investments.

At Park Bank, we take compliance and risk-management very seriously, and we always have the best interest of the communities we serve in mind.

At Park Bank, We’re Rock Solid.

Park Bank is here to stay.

How can we be so confident?

For starters, Wisconsin banks are safe, sound, and resilient. The banking system remains strong, and Park Bank’s liquidity and capital positions have us prepared to thrive and grow well into the future. We were chartered 57 years ago and intend to serve this community and our clients for many years to come.

As a community bank, we operate and are structured very differently than “big banks” with a focus on providing traditional banking services to the communities we serve.

Since the FDIC was founded in 1933, no one has ever lost a cent of an insured deposit.

And here’s one more fun fact before we move on: the FDIC estimates that over 66% of deposits at Wisconsin banks are insured. Compare that to the less than 10 percent of deposits that were insured at Silicon Valley Bank. Wisconsin banks are much more diversified across different business and personal sectors than SVB and the others that collapsed.

FDIC Insurance: Pro Tips

Remember seeing this earlier: “Today, FDIC insurance covers depositors up to $250,000 per depositor, per insured bank, in each account ownership category (more on this in a moment).”

That moment is now.

Here’s an example of how spouses (let’s call them Kevin and Karla) can utilize single and joint ownership categories to have FDIC coverage of up to $1 million:

• Kevin sets up an account in just his name (insured up to $250,000).
• Karla sets up an account in just her name (insured up to $250,000).
• Kevin and Karla set up a joint account (insured up to $500,000).

Pretty neat.

For more information about FDIC insurance coverage, take a look at the FDIC resources brochure.

Here’s another helpful tidbit for you – the FDIC has an online tool to help you determine whether your accounts are fully insured at each bank in which you hold deposits. It’s called “EDIE” (Electronic Deposit Insurance Estimator), the FDIC Calculator.

According to the FDIC’s website, “EDIE lets consumers and bankers know, on a per-bank basis, how the insurance coverage and limits apply to a depositor’s specific group of deposit accounts (e.g., interest checking accounts, savings accounts, etc.) — what’s insured and what portion (if any) exceeds coverage limits at that bank.”

We have one final note for you: At Park Bank, our employees are “relationship” bankers – not “transactional” bankers. We’ll always take the time to get to know you and learn about your specific needs.

Know that your deposits are safe here at Park Bank, and if you ever have questions or concerns, we’re happy to talk to you.

Bottom Line: We always want what’s best for you!

Now that you know how FDIC insurance works and that your deposits are in good hands with Park Bank, is the timing right for you to invest in one of our CD specials? Check out our rates and connect with us today!