by 
The Curious Bag
-
<h4 class="dechead">On One Hand: Some Are Safe
According to Karen Tyson of the Independent Community Bankers of America in an article in Newsweek, the majority of community banks did not participate in the subprime lending that led to the mortgage and banking crisis. Community banks with sound business practices are trustworthy.
On the Other: Some Are Not Safe
According to Lessons from Lehman, as of September 2009, many of the banks that are struggling to survive are local banks that lent money to small businesses or consumers. Most of the failures have been community banks with less than $10 billion in assets.
Bottom Line
Big banks versus community banks do not make any difference to the depositor who has $250,000 or less in the institution, because the FDIC guarantees deposits up to that amount. Therefore, most deposits are safe, no matter which bank has them.
Source:
Nightly Business Report: "Lessons from Lehman"--Community Bank Failures
RELATED QUESTIONS
Copyright 2023, Wired Ivy, LLC