A deposit insurance national bank (DINB, [1]) is a temporary bank in the United States that is established by the Federal Deposit Insurance Corporation (FDIC) in the wake of a bank failure under the Banking Acts of 1933 and 1935.[2]
DINBs are chartered by the Office of the Comptroller of the Currency. Upon creation, the bank assumes the failed bank's insured deposits and temporarily provides banking services to customers.[3] A DINB's powers are narrowly limited to servicing the insured deposits of a failed bank; it cannot acquire assets from the failed bank, as a bridge bank can, nor can it accept uninsured deposits, unless it is the only depository institution in its community.[4]
The bank is managed by an executive officer appointed by the FDIC. A DINB is not required to have paid-in capital stock, has no board of directors, and is not required to own stock in a Federal Reserve Bank. Otherwise it conforms to the National Bank Act and other laws relevant to national banks.
A DINB can operate for up to two years. It can be acquired by another bank in its community, raise capital to become a permanent bank, or wind down and transfer its obligations to the FDIC.
DINBs were initially the only way that the FDIC could resolve a failed institution. The first DINB was the Deposit Insurance National Bank of East Peoria, created when Fond Du Lac State Bank was closed by Illinois regulators on May 26, 1934.[5] Under this original deposit insurance system, the FDIC assumed receivership of nine insured banks and paid off their deposits through DINBs.[6]
After the Banking Act of 1935 permitted the FDIC to pay out depositors without establishing a DINB, use of this resolution method largely ceased, except for cases where a bank failed in an area with only limited banking services or where a prompt pay-out was not possible. For example, 1975 saw failures of Swope Parkway National Bank, a Black-owned business serving the local Black community, and The Peoples Bank of the Virgin Islands, which was the only locally owned institution in the U.S. Virgin Islands; a DINB was created for each in hopes of giving the community time to establish a replacement institution. Only five DINBs were created by the FDIC between 1935 and 1998.
Initially, the FDIC responded to the 2023 collapse of Silicon Valley Bank by forming a Deposit Insurance National Bank of Santa Clara[7] because no institution was immediately willing to assume its substantial uninsured deposits. After the Treasury granted an exception to cover the uninsured deposits, the DINB was replaced with a bridge bank named Silicon Valley Bridge Bank, N.A.[8] [9]
| Year | Failed bank | DINB | Headquarters | |
|---|---|---|---|---|
| 1934 | Fond Du Lac State Bank | Deposit Insurance National Bank of East Peoria | East Peoria, Illinois | |
| 1934 | Bank of America Trust Co. | Deposit Insurance National Bank of Pittsburgh | Pittsburgh | |
| 1934 | The First National Bank of Lima | Deposit Insurance National Bank of Lima | Lima, Montana | |
| 1934 | The Florence Deposit Bank | Deposit Insurance National Bank of Florence | Florence, Indiana | |
| 1934 | Bank of Lewisport | Deposit Insurance National Bank of Lewisport | Lewisport, Kentucky | |
| 1934 | Farmers & Traders Bank | Deposit Insurance National Bank of Porterfield | Porterfield, Wisconsin | |
| 1934 | The Pickens County Bank | Deposit Insurance National Bank of Jasper | Jasper, Georgia | |
| 1934 | The State Bank | Deposit Insurance National Bank of Sauk City | Sauk City, Wisconsin | |
| 1934 | Farmers State Bank of Bongards | Deposit Insurance National Bank of Bongards | Bongards, Minnesota |
| Year | Failed bank | DINB | Headquarters | |
|---|---|---|---|---|
| 1935 | The Commercial National Bank of Bradford | Deposit Insurance National Bank of Bradford[10] | Bradford, Pennsylvania | |
| 1964 | First State Bank[11] | Deposit Insurance National Bank of Dell City[12] | Dell City, Texas | |
| 1964 | Crown Savings Bank | Deposit Insurance National Bank of Newport News[13] | Newport News, Virginia | |
| 1975 | Swope Parkway National Bank | Deposit Insurance National Bank of Kansas City | Kansas City, Missouri | |
| 1975 | The Peoples Bank of the Virgin Islands | Deposit Insurance National Bank of the Virgin Islands[14] | Charlotte Amalie, U.S. Virgin Islands | |
| 1982 | Deposit Insurance National Bank of Oklahoma City[15] | Oklahoma City | ||
| 2009 | Deposit Insurance National Bank of Greeley[16] | Greeley, Colorado | ||
| 2009 | Community Bank of Nevada | Deposit Insurance National Bank of Las Vegas[17] | Las Vegas | |
| 2009 | Citizens State Bank | Deposit Insurance National Bank of New Baltimore[18] | New Baltimore, Michigan | |
| 2010 | Barnes Banking Company | Deposit Insurance National Bank of Kaysville[19] | Kaysville, Utah | |
| 2010 | Waterfield Bank[20] | Waterfield Bank, FA[21] | Germantown, Maryland | |
| 2011 | Enterprise Banking Company | Deposit Insurance National Bank of McDonough[22] | McDonough, Georgia | |
| 2011 | FirsTier Bank | Deposit Insurance National Bank of Louisville[23] | Louisville, Colorado | |
| 2012 | Bank of the Eastern Shore | Deposit Insurance National Bank of Eastern Shore[24] | Cambridge, Maryland | |
| 2023 | Deposit Insurance National Bank of Santa Clara[25] | Santa Clara, California |