Community banking customers like those at SSB seek out safety and security for their finances within their own communities. However, you wouldn’t be a prudent banker if you didn’t wonder how exactly your money is being protected within the landscape of America’s banking system, especially in light of recent volatility. Rest assured that deposits at SSB Bank are safeguarded against instability.
So, how do community banks stack up against larger institutions? Community banks play a unique role in communities, allowing them to make decisions within a local context—which supports security. Moreover, community banks like SSB can provide the same protection against instability as large commercial banks because they are both backed by the Federal Deposit Insurance Corporation (FDIC).
Safety and Stability of Community Banks like SSB
Community banks provide a different level of service and security than larger institutions. We share local values and have a better understanding of the unique needs of our clients. Through relationship-based banking, we provide personalized service and local decision-making. By supporting local small businesses and community development, we are also invested in the success and prosperity of the local community.
Community banks ensure the integrity of operations and the security of customer funds in several ways, including the structure and focus of the organization. SSB works to keep your money safe through:
Risk management. We actively evaluate credit, market, operational, and compliance risks to ensure the safety of deposits.
Strong capitalization. We sustain a solid capital base to absorb unexpected losses and maintain stability through economic turbulence.
Regulatory oversight. Federal and state agencies provide regulatory oversight to community banks ensuring compliance with rules and regulations.
Proactive fraud prevention. We identify and prevent fraud through advanced security systems.
Relationship-based banking. SSB prioritizes customer relationships including education about best security practices. We take any opportunity to advise our clients on smart financial habits and decisions.
Collaboration with local law enforcement. Community banks work with law enforcement agencies to report suspicious activities and cooperate in investigations. In this way, we contribute to the overall security of the financial system.
How Community Banking Keeps Your Funds Secure
While community banks employ many security measures, no system is entirely foolproof. Therefore, FDIC insurance remains a vital safeguard for depositors, providing an additional layer of protection and peace of mind. The biggest line of defense that community banks have against economic failure is the FDIC.
The FDIC protects banking customers in America by insuring the funds that they deposit in banks. In the rare event that a banking institution insured by the FDIC fails—like what occurred during the Silicon Valley Bank collapse in March of 2023— the FDIC recovers funds for impacted depositors. The main purpose of this independent government agency is to maintain economic stability and public confidence in our banking system.
As a customer of SSB, you are protected by the FDIC. Banks like ours become a member of the FDIC in order to offer our customers the best protection possible. In addition to deposit insurance, the FDIC provides guidance on compliance, risk management, and maintaining stability. Our membership helps us contribute to the overall strength of our nation’s banking system.
Money Backed by the FDIC
Under the FDIC insurance program, deposits such as checking accounts, savings accounts, certificates of deposit (CDs), and certain retirement accounts are insured up to $250,000 per depositor, per ownership category. This means that even if a bank fails, depositors can rest assured that their insured deposits are backed by the full faith and credit of the U.S. government.
FDIC insurance helps maintain stability in the banking system, promotes public trust, and ensures that depositors have access to their funds when they need them. The main benefits of FDIC insurance for depositors are protection against bank failures, accessibility to insured funds, and peace of mind.
Limits of the FDIC
While the FDIC provides massive protection for American bankers, there are limits to what it’s capable of. Firstly, the FDIC can only protect banks insured by the FDIC. Not all financial institutions are insured by the FDIC, such as credit unions, investment banks, and certain types of non-bank financial institutions.
Here are some other key limits of the FDIC:
Deposit insurance limit. The FDIC limits coverage to $250,000 for each depositor, insured bank, and ownership category. An individual’s deposits exceeding this amount at the same bank and in the same ownership category may not be protected.
Account types. Different types of accounts have different insurance limits. If a banker has accounts across ownership categories at the same bank, coverage may vary.
Non-depository products. The FDIC covers deposits in traditional bank accounts like checking, savings, and certificates of deposit (CDs). Non-depository products like stocks, bonds, and mutual funds are not insured.
Fraudulent activity. The FDIC only insures deposits in the case of bank failures. It does not protect depositors against losses due to fraud or theft.
Foreign deposits. The FDIC only covers deposits in domestic banks, though foreign banks may provide similar deposit insurance.
Time delays. In case of a bank failure, it may take some time for bankers to recover funds as the FDIC processes claims.
What Happens In the Event the FDIC Needs to Step In
In the case that an FDIC-insured bank fails, the FDIC is appointed as the receiver for the bank assuming control of the bank's assets, liabilities, and operations. The FDIC conducts a thorough assessment of the bank's financial condition to determine the extent of the failure and evaluate potential options for resolution. Its primary concern is protecting depositor funds.
As a depositor, you can check with your bank about the accessibility of your funds and watch for statements from the FDIC about the status of the receivership. Typically, the FDIC will mail forms to depositors in order to file claims. During the bank's resolution process, the FDIC will facilitate the transfer of insured deposits to another bank for depositors to access.
Security of SSB
Community banking provides some amazing benefits to bankers, security included. We play an important role in America’s banking system, supporting and protecting our local communities. By joining the FDIC, we enjoy the same protection and security provided by larger institutions.
At SSB, we pride ourselves on our personal customer service, the quality of our products, and of course the security that we offer the Pittsburgh community. While our FDIC membership backs your deposits, we take many measures to prevent instability in the first place. We understand the high level of service that our clients expect, and we work diligently to provide a secure banking experience.
Join us today!