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The deposits are spread over a more diversified set of banks and the risk is reduced.
by chrisbolt 4y ago
The deposits are spread over a more diversified set of banks and the risk is reduced.
- yibg 4y agoNot for FDIC. 10 people each with 1mm in 10 different banks. If FDIC covers the entire amount when 1 bank fails, they pay 10mm. If all 10 people spread 100k across 10 different banks and 1 bank fails, FDIC pays 100k x 10 which is still 1mm.