Lee R. Schroeder is an Ohio licensed attorney at Schroeder Law LLC in Putnam County. He limits his practice to business, real estate, estate planning and agriculture issues in northwest Ohio. He can be reached at [email protected] or at 419-659-2058. This article is not intended to serve as legal advice, and specific advice should be sought from the licensed attorney of your choice based upon the specific facts and circumstances that you face.
The question often comes up of what will happen to money in a bank if the bank closes. Typically, there’s no cause for concern when a bank closes, as your money should be safe. When money is deposited in banks, it’s protected in several different ways.
First, money deposited in banks is protected by the government’s bank auditing and examination laws. Second, when banks loan money, it’s not always the bank’s own money. Finally, money in certain bank accounts is protected through FDIC insurance.
“What happens if my bank closes?” is a question I sometimes get from clients. This concern can be even more pointed when another borrower/customer of a small, local bank goes out of business. If the bank lost hundreds of thousands of dollars on that other borrower’s/customer’s failure, isn’t my deposit in that bank at risk?
Generally, there is no need to worry in this context. There are multiple, duplicative methods used to protect money, particularly when deposited in banks.
Read more about how your money in the bank is kept safe in Lee’s article in the Lima News here: Legal-Ease: Keeping money safe
Source: LimaOhio.com, “Legal-Ease: Keeping money safe,” by Lee R. Schroeder, October 7, 2017