More Bank Failures This Year

August 3, 2008

Since I blogged about the IndyMac Bank failure a little while ago, there have been several banks to go under with First Priority Bank in Bradenton, Florida being the latest casualty. It was closed last Friday, August 1, 2008 and is being taken over by SunTrust Bank. Two banks were also closed on July 25 bringing the total number of bank failures this year to eight.

This is just another reason to make sure you are covered under the FDIC insurance protection of up to $100,000. You can find more information on the article I wrote earlier on FDIC insurance. This is no time to panic. Your money is safe and there’s nothing to worry about.

Any bank can fail if there is a run on the bank because of the way banks operate to begin with. Banks don’t hold all of their deposits on hand and are only required to hold a certain percentage so if there is a run on the bank, there won’t be enough assets to cover the withdrawals. But there is no reason to take out your money because of FDIC insurance.

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