Over the weekend news broke that another bank had failed. The headlines read “Citizens Bank becomes the fifth US bank to fail in 2023”. I wanted to take a moment and talk about some facts that you may be hearing and hopefully calm some fears about what has happened.
“Citizen’s bank is a huge bank, what if the other big ones go down” – Yes, this is a Citizens Bank, however it is not ALL Citizens banks. It was Citizens Bank, Sac City, Iowa. Big difference, right? This Citizens Bank only has $66 million in total assets.
“They didn’t tell anyone, they just took it over” – Banks have their regulators and they are the FDIC (Federal Deposit Insurance Corporation) insured, they are to banks as to what NCUA (National Credit Union Administration) is to credit unions. Four times a year banks and credit unions must report directly to these regulators with all data on the financial institution. They are reviewing every aspect of the operation. I am sure the decision was not made lightly to step in, and they have been watching this bank for some time. The reason for not giving notice of the transfer would be for the safety of their customers. If you heard that your financial institution was in trouble, there would be a run on the bank, this would cause major problems for everyone involved.
“Why are these banks failing” – Financial Institutions have failed in the past, the difference is that the media is making it “big news.” Did you know that in 2020 four banks failed, and in 2019 four banks also failed? These things do happen, but usually not in mass instances. Rest assured; their regulators are on top of this to ensure that their depositor’s money is safe.
“What happens next to their money” – When this happens the regulator finds another financial institution to in essence buy them out. For a few days there are some struggles and anxiety on the part of the customer, but in the end, things will settle, and their customers will then have accounts with the bank that bought them out.
“Is my money safe” – ABSOLUTLY! The Syracuse Fire Department Credit Union is as strong as ever. There is zero reason for concern with your accounts. We are up to date on all reporting with NCUA, and our financials look fantastic! If you have any questions or concerns, you can always call the office or stop in, and I will gladly talk details with you.