North Dakota banks are safe, commissioner says

(The Center Square) – The Commissioner for North Dakota’s Department of Financial Institutions said the state-chartered banks and credit unions “remain stable” amid Silicon Valley Bank’s and Signature Bank’s collapses, triggering concerns among other banks.

Commissioner Lisa Kruse said those who bank with North Dakota’s state-chartered banks and credit unions are protected through the Federal Deposit Insurance Corp. (FDIC).

“Community financial institutions have a relationship-based business model. With local leadership and a commitment to their customers and communities they serve, these institutions are well-equipped to continue providing financial services to North Dakota citizens. This is in direct contrast to the business model of the recently collapsed banks,” Kruse said.

She went on to say deposits are insured up to $250,000 per account.

“Our department remains committed to ensuring a safe and sound financial system for the citizens of North Dakota,” said Kruse.

The Department of Financial Institutions regulates North Dakota’s financial institutions, including trust companies, non-depository financial institutions, state-chartered banks, and credit unions.

The commissioner’s statement comes as banks are watching the fallout from the Silicon Valley Bank collapse along with New York-based Signature Bank.

On Monday, First Republic Bank saw shares fall by up to 50% after banks already attempted a rescue last week with $30 billion in deposits, according to Reuters.

Bank of America, Citigroup, JPMorgan Chase and Wells Fargo each made $5 billion uninsured deposits into First Republic Bank, while Goldman Sachs and Morgan Stanley each made uninsured deposits of $2.5 billion. In addition, BNY‑Mellon, PNC Bank, State Street, Truist and U.S. Bank each made uninsured deposits of $1 billion to “reflect their confidence in First Republic and in banks of all sizes,” said Wells Fargo in a statement.

Meanwhile, multinational investment bank UBS Group AG is working on a takeover of Credit Suisse Group AG, a move that will likely prevent a larger banking crisis, a chief market strategist told Reuters.

Some lawmakers are calling on the Fed to provide answers about Silicon Valley Bank’s collapse. A letter signed by Republican and Democratic senators said they had deep concerns about how regulators “missed clear warning signs.”

“The Fed should review the financing arrangements between SVB and its customers to determine their impact on the bank’s collapse. Allowing such a high concentration of these rate-sensitive customers with primarily uninsured deposits at any single bank strikes us as a compelling risk to the stability of the bank, the banking system, and to taxpayers writ-large that merits further inquiry,” the letter said.