Why it matters:
On the rare occasion that a bank fails, media and pundits spark concerns about the safety of deposits, but the banking system has robust protections in place for consumers.
By the numbers:
- Only 3 banks have failed in Utah over the past 15 years
- All bank accounts are FDIC-insured up to $250,000
- Utah banks rank among the highest-performing and best-capitalized in the country
The big picture: Bank failures, while newsworthy, rarely impact depositors thanks to a well-designed regulatory system.
How it works:
- When a bank fails, regulators typically transfer deposits to a stronger bank
- The transition happens over a weekend – closed Friday, reopens Monday
- Customers keep full access to their money
- Only the bank’s name and mobile app change
Yes, but:
Even accounts exceeding $250,000 can be protected through proper structuring – consult your banker for guidance.
Between the lines:
The biggest threat to banks isn’t financial instability – it’s panic. Even healthy banks can’t survive if all customers withdraw simultaneously.
The bottom line:
Despite occasional media hysteria about bank failures, your money is secure in the banking system. When you hear alarming news about banks:
- Don’t rush to withdraw funds
- Remember the FDIC insurance protection
- Question the credibility of sources creating panic
What they’re saying:
“There’s a reason you haven’t heard about people losing their money in their bank. The whole banking system is set up to prevent that,” says Howard Headlee, President and CEO of the Utah Bankers Association.