How reliable are the US Banks?

Question

In Canada we only have a few large Chartered Banks. How many banks are there in the US? How often are there US banks go out of business?

Answer 1

There are many "National" banks in the US. They are required to belong to FDIC, which was described in the first respondants answer. Part of FDIC strategies for poorly-performing banks is to merge them with a more-healthy bank, so a bank "going out of business" is fairly unusual. There used to be State Banks, but I think they are pretty much gone. There used to be Federal Savings&Loan Associations, which were insured by FSLIC. However, in the last 1980s, many of these went bankrupt when the 1986 tax law changed rules, and they (as well as) FSLIC were disbanded. Federal Credit Union are still around, with many thousands in existance, and are insured by NCUA.

Answer 2

Any bank you want to do business with will be insured with FICA, which is up to $100,000 per account. And that is to say that it is backed by the US government. So if a bank goes bankrupt (doesn't happen very often) the US government will step in and refund all the money in someones account up to $100,000. This basically came out of a change in laws after the depression when banks closed and people lost their money.

Opps wrong abbreviation: FDIC not FICA.

As for how many banks. There are banks and also credit unions, which for the most part work just like banks, and there are thousands of them. Maybe the major ones in the 100s. Then there are the top ones that deal with the federal banking system and there are only a few of those.

Answer 3

There are hundreds of banks in the US. Most are chartered by states, but many of the largest are chartered by the federal government. They are all insured by the FDIC (up to $100000 per account) so they are very safe.