FDIC: Minority Depository Institutions Program (2024)

FAQs

What is the minority bank deposit program? ›

Minority Bank Deposit Program – This voluntary program encourages federal agencies, State and local governments and the private sector to use Minority Bank Deposit Program participants as depositaries and financial agents.

Section 308 of FIRREA defines a “minority depository institution” as any Federally insured depository institution (IDI) where 51 percent or more of the voting stock is currently owned by one or more “socially and economically disadvantaged individuals.” The term “minority” is defined by Section 308 of FIRREA as any “ ...

​​​​Credit unions designated as minority depository institutions provide safe, affordable financial services to members and communities who are often unserved or underserved by financial institutions.

FDIC Technical Assistance Resources

The Technical Assistance Program provides MDIs with an opportunity to request return visits and technical assistance tailored to your institution. If you would like to take advantage of this program, please contact your Regional MDI Coordinator.

OneUnited is the largest Black-owned bank in the U.S. It is also FDIC insured and initially launched in 1968. How do I find out if my bank is Black owned?

Commercial banks offer basic banking services, including deposit accounts and loans, to consumers and businesses. These financial institutions make money from a variety of fees and by earning interest income from loans.

Investment products that are not deposits, such as mutual funds, annuities, life insurance policies and stocks and bonds, are not covered by FDIC deposit insurance. See “Financial Products that Are Not Insured by the FDIC” for more information about uninsured financial products.

The standard maximum deposit insurance amount is $250,000 per depositor, per insured bank, for each account ownership category. The FDIC insures deposits that a person holds in one insured bank separately from any deposits that the person owns in another separately chartered insured bank.

Millionaires don't worry about FDIC insurance. Their money is held in their name and not the name of the custodial private bank.

What is the main purpose of a depository institution? ›

A depository institution is a place or entity — such as a bank — that allows consumers and businesses to deposit money, securities, and/or other types of assets. There, the deposit is kept safely and may earn interest.

They are commercial banks, thrifts (which include savings and loan associations and savings banks) and credit unions.

The FDIC insures deposits; examines and supervises financial institutions for safety, soundness, and consumer protection; makes large and complex financial institutions resolvable; and manages receiverships.

The FDIC defines a minority depository institution (MDI) as, “a federal insured depository institution for which (1) 51% or more of the voting stock is owned by minority individuals; or (2) a majority of the board of directors is minority and the community that the institution serves is predominantly minority.”

MDIs are strictly insured depository institutions, but CDFIs can take different structures including nonregulated loan and venture capital funds, in addition to being regulated banks and credit unions.

Bank Deposit Program - Program Banks

Under the Bank Deposit Program, free credit balances held in an account(s) at Morgan Stanley Smith Barney LLC are automatically deposited into an interest-bearing deposit account(s), at FDIC-insured banks.

The FDIC provides deposit insurance to protect your money in the event of a bank failure. Your deposits are automatically insured to at least $250,000 at each FDIC-insured bank.

The Banking Act of 1935 is signed into law by FDR making the FDIC permanent. The deposit insurance provisions include: Maintaining the $5,000 coverage limit. This would mean that approximately 98 percent of depositors in U.S. banks would be fully covered.

At the end of 2022, there were 503 federally insured credit unions designated as MDIs, about one in 10 of all federally insured credit unions. They were located in 35 states, the District of Columbia, Puerto Rico, and the U.S. Virgin Islands.