Americans are stashing massive amounts of cash in bank accounts that aren’t protected by the FDIC, a new report reveals.
Big Banks, Big Risk
Customers at JPMorgan Chase, Wells Fargo, and Bank of America alone hold a staggering $2.62 trillion in uninsured deposits. That’s money exceeding the FDIC’s $250,000 insurance limit per depositor, per insured bank. This means billions of dollars belonging to businesses, retirees, and families could be at risk if one of these banks were to fail.
Uninsured Deposits on the Rise
The FDIC reports a huge jump in uninsured deposits across all US banks during the fourth quarter of 2024. Uninsured deposits soared by $126.6 billion, far surpassing the increase in insured deposits.
The SVB Exception and Beyond
The government’s response to the Silicon Valley Bank (SVB) collapse in 2023—where all depositors were protected, regardless of insurance—highlights the potential consequences. However, smaller bank failures, like that of Republic First Bank, showed a different picture: uninsured depositors faced losses.
A Risky Gamble?
This surge in uninsured deposits comes despite strong bank profits, totaling $66.8 billion in net income. While the banking industry is currently doing well, the sheer volume of unprotected money raises concerns about potential future risks. It’s a gamble that could have significant consequences for millions of people.
Disclaimer: This information is for general knowledge and does not constitute financial advice. Always do your research before making any financial decisions.
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