Bank failures are bad. Being unprepared for them is worse.
In Canada and dozens of other countries, deposit insurance protects people’s money — up to a certain dollar value — when the worst happens and aims to provide financial stability.
Three times this year, the United States has seen deposit insurance in action, when mid-size banks have failed — most recently with First Republic Bank, an institution whose resolution is expected to cost the Deposit Insurance Fund, which is mainly supported through assessments on banks, some $13 billion US.
First Republic’s collapse, the second-biggest bank bust in U.S. history, came weeks after the folding of Silicon Valley Bank (SVB) and Signature Bank in March. Those banks’ prior resolutions cost the same fund more
