Bank Depository Bond

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Bond Penalty: Based on Coverage Requested Excess FDIC Limits

A bank depository bond is a sort of insurance coverage the protects account holders where an account balance may significantly exceed the protection provided by the Federal Depository Insurance Corporation (FDIC). These surety bonds are generally requested by financial institutions that offer account and fiduciary services to high-net-worth individuals and businesses, non-profit organiztatoins, educational institutions and governmental entities. The bank depository bond provides coverage excess (XS) over the underlying protection. These are written in three forms.

  • Single depositor.
  • Individual depositors by schedule.
  • Blanket group bonding for a specific class such as an HOA or COA.

Depository bonds are attractive products to all interested parties. Most banks and credit unions acquire U.S. Treasury-issued securities and pledge them as collateral in support of the financial institution's depositor account exposures. The use of a bank depository bond provides capital relief to the institution, freeing that capital for other business uses. It also makes the bank or CU more attractive to large private customers, businesses and government agencies (the latter often making it a requirement because the money on deposit is generally considered "public funds"). In the case of the covered financial institution's insolvency, the depositors make claim directly on the bank depository bond. The FDIC's governing board has considered the institution of a program to offer excess deposit insurance in certain areas. You may read that advisory letter here.

Surety One, Inc. specializes in underwriting fidelity bond risks for classes of financial institution. We offer blanket banker's bonds, miscellaneous fidelity bond coverages and STAMP bonds to chartered banks, S&Ls, federal trust banks and credit unions. For more information call (800) 373-2804, email us at or click here to live chat about a bank depository bond application or for any other surety bond need.

Surety bond application review and quoting are free of charge. There is no obligation to purchase.

What We Need From You

Additional Attachments

  • Financial Institution's Most Current Audited Financial Statement

Obligee's Bond Form