Safety & Soundness of SNBT

March 13, 2023

As we read and watch the news from the past few days, we want to take a moment to send a reminder to you, our customers. The Stephenson National Bank & Trust (SNBT) has a history of stability and resiliency and is still a place where you can put your trust. 

What happened was a very unique situation

The swift closure of two banks in California and New York by the Federal Deposit Insurance Corporation (FDIC) was done decisively to protect the banking system and customers.

The banks were heavily connected to the tech sector, which made them vulnerable to booms and busts. Plus, they were NOT well diversified on the loan and deposit side. Moreover, less than 10% of deposits were insured, as they were very large deposits, largely from venture capitalists that deposited tech investment money. All of which caused them to grow rapidly from $50 billion to $200 billion in the span of 18 months. 

By contrast, community banks like SNBT, are much more diversified across different business and personal sectors, and the majority of deposits are insured.

SNBT is strong and well-capitalized

  • In our 148-year history, we have withstood wars, pandemics, the great depression, and more recent recessions and our solid business practices will keep our doors open for decades to come.
  • SNBT remains well-capitalized and well positioned to continue to serve our customers and community.
  • Community banks, like SNBT, operate under an entirely different business model and did not engage in risky practices which are part of the reason for the recent closures. 
  • As a customer, you have access to our experienced team who are ready to assist you with any of your questions or concerns. 
  • As a community bank, we take pride in our relationship-based business model focused on building long-term trust with our customers. After all, we live in your community too, and your success is our success.

Be Extremely Cautious about Scams

Fraudsters take advantage of confusion and chaos in the markets. Therefore, be especially alert for scams that seek to take advantage of anxiety over the safety of your assets.
  • Be extra careful with all requests you receive about your accounts, whether by phone, email, or text.
  • If you receive a suspicious request stop and think before responding. Call the company or employee using contact information you already have on file or a phone number obtained through the company's official website. Remember: Caller ID and email addresses can be easily faked.
  • Any legitimate financial institution should already have customer account information on file and will not suspiciously call, text, or email a person asking to "verify" it. If you are ever asked for this information, and are worried about the authenticity of the request, contact your financial institution using a trusted phone number or notify your local police department.

More information about how the FDIC protects depositors’ money: 

  • Every customers' deposits are protected by FDIC insurance up to $250,000 in eight separate account categories, per depositor, per bank.
  • Not one depositor has ever lost a penny of their insured deposits in the 88-year history of the FDIC.
  • The FDIC insurance fund, and all of the agency’s costs, come entirely from premiums paid by banks.  
  • A strong deposit insurance fund and a well-capitalized banking industry are essential to our economy:
    • The FDIC insurance fund stood at an all-time high of $124.5 billion as of June 2022. 
    • The FDIC has a $100 billion line of credit with the U.S. Treasury, which would, by law, have to be repaid by the banking industry if ever used. 
    • In total, more than 99 percent of banks are “highly capitalized” and far above the most stringent regulatory standards. 
Here are some resources, in case you have questions about your coverage, or would like to learn more about FDIC insurance and how it works. As always, you are welcome to call, stop by, send an email, or online chat if you have any questions.
•    Understanding Deposit Insurance
•    FDIC Deposit Insurance FAQs
•    FDIC Calculators