Banks that have failed in the United States since 2008

Since the 2008 financial crisis, 563 banks have failed in the United States through 2023. The largest and most recent failures were Silicon Valley Bank (March 2023), Signature Bank (March 2023), and First Republic Bank (May 2023). Before that, the most notable failure was Washington Mutual in 2008, which held $307 billion in assets at the time of collapse.

Bank failures happen when a bank runs out of money to cover withdrawals and cannot borrow enough to stay open. The Federal Deposit Insurance Corporation (FDIC) steps in, takes over the bank, and pays depositors back up to the insurance limit. Most people who had money in these failed banks recovered their funds, though the timeline and process varied by institution.

The number of failures has dropped significantly since the crisis years. Between 2009 and 2011, the FDIC closed an average of 92 banks per year. By 2022, that number had fallen to zero. The 2023 failures marked the first time since 2011 that major banks closed, and they sparked renewed attention to deposit safety.

Key Takeaways

  • The FDIC insures deposits up to $250,000 per depositor, per bank, per account category, which covers most people's savings even if a bank fails.
  • When a bank fails, the FDIC typically pays insured depositors within days, though uninsured deposits above the limit may take longer or recover only partially.
  • You can check whether your bank is FDIC-insured and see your coverage limits using the FDIC's online tool at ibank.fdic.gov.
  • Spreading money across multiple banks or account types (checking, savings, retirement accounts) increases your total FDIC protection without changing how you bank.

How FDIC insurance protects your deposits

The FDIC is a federal agency that insures bank deposits. When you open an account at an FDIC-insured bank, your money is automatically covered up to $250,000 per depositor, per bank, per account category. This means if the bank fails, you get your money back up to that limit, even if the bank has no money left.

The $250,000 limit applies separately to different account categories. A checking account, savings account, and retirement account (IRA) at the same bank are each insured for $250,000. Joint accounts are insured separately too — if you and your spouse have a joint account, you each get $250,000 of coverage on that account. Money market accounts and certificates of deposit (CDs) count as savings accounts for insurance purposes.

Not all banks are FDIC-insured. Most traditional banks are, but some credit unions use a different system (the National Credit Union Administration, or NCUA), and some online banks or investment firms are not insured at all. You can verify your bank's status and calculate your coverage using the FDIC's Electronic Deposit Insurance Estimator at ibank.fdic.gov.

What happened to depositors when major banks failed

When Silicon Valley Bank failed in March 2023, it held $209 billion in deposits. About 93% of those deposits were above the $250,000 insurance limit, meaning roughly $150 billion was technically uninsured. However, the FDIC and the U.S. Treasury announced that all depositors would be made whole — insured and uninsured alike — to prevent a broader financial panic.

This outcome was unusual. Normally, uninsured depositors lose money when a bank fails. In the 2008 crisis, depositors with balances above the insurance limit at failed banks recovered between 0% and 100% of their uninsured funds, depending on how much the FDIC could recover by selling the bank's assets. The recovery process took months or years.

For Silicon Valley Bank and Signature Bank, the FDIC moved quickly. Insured depositors received their money within one business day. Uninsured depositors were told they would receive payment, though the exact timeline depended on how the FDIC resolved the bank's assets. First Republic Bank depositors were transferred to JPMorgan Chase, so most account holders simply switched banks without losing access to their money.

How to check if your bank is FDIC-insured

You can verify FDIC insurance status in three ways. The simplest is to look for the FDIC logo on your bank's website or in its lobby — all FDIC-insured banks display it. Second, you can call the FDIC's toll-free number at 877-275-3342 and ask whether a specific bank is insured. Third, you can search the FDIC's Bank Find tool at banks.fdic.gov, which lists every insured institution and shows which branches are covered.

The Bank Find tool also shows your coverage limits for each account you hold at that bank. If you want a detailed calculation before opening an account, use the Electronic Deposit Insurance Estimator at ibank.fdic.gov. You enter your bank name, account types, and balances, and the tool shows exactly how much is insured and how much is not.

If your bank is not FDIC-insured, your deposits have no federal protection if the institution fails. Credit unions use NCUA insurance instead, which works the same way ($250,000 per account category). Investment accounts, brokerage accounts, and money held in stocks or mutual funds are not covered by FDIC or NCUA insurance — they are protected by different rules.

Strategies to maximize FDIC coverage across multiple accounts

If you have more than $250,000 to deposit, you can protect all of it by spreading money across different banks or different account categories at the same bank. Each bank is a separate insurance unit, so $250,000 at Bank A and $250,000 at Bank B are both fully insured. You can also use different account types — a checking account, savings account, and IRA at the same bank each get their own $250,000 limit.

Joint accounts offer another layer. If you and your spouse each have $250,000 in a joint savings account, you are both insured for the full amount because joint accounts are a separate category. A revocable trust account (also called a payable-on-death account) is insured separately too, up to $250,000 per beneficiary named in the trust.

Some people use sweep accounts or linked accounts to manage this automatically. A sweep account moves money between checking and savings to keep balances under the insurance limit. However, you do not need a special product — you can simply open accounts at different banks or in different names (individual, joint, trust) and track the balances yourself. The FDIC's estimator tool helps you verify that your setup is correct.

What to do if your bank fails

If your bank fails, the FDIC will contact you. You will receive a notice in the mail and a phone call if the bank has your number on file. The notice explains your coverage status and how to claim your insured funds. Do not panic if you cannot access your account immediately — the FDIC typically pays insured depositors within one to three business days.

If your balance is under $250,000, you should receive payment automatically. If your balance is above that limit, the FDIC will pay the insured portion right away. For the uninsured portion, you become a creditor of the failed bank, and the FDIC will tell you how to file a claim. Recovery of uninsured funds depends on how much the FDIC recovers by selling the bank's assets, which can take months or years.

If you do not receive payment within a reasonable time, contact the FDIC directly. You can call 877-275-3342 or visit fdic.gov to find the regional office handling your failed bank. Have your account number and the bank's name ready. The FDIC keeps records of all deposits and can verify your coverage even if the bank's records are incomplete.

Why banks fail and how regulators try to prevent it

Banks fail when they lose money faster than they can raise it. Common causes include bad loans (borrowers who do not repay), sudden withdrawals (a "run" on the bank), or investments that lose value. Silicon Valley Bank failed because it held long-term bonds that lost value when interest rates rose, and when depositors rushed to withdraw money, the bank did not have enough cash on hand.

Federal regulators — the Federal Reserve, the FDIC, and the Office of the Comptroller of the Currency — monitor banks to prevent failures. They require banks to hold a minimum amount of capital (money set aside as a cushion), conduct stress tests to see how banks would handle a crisis, and inspect banks regularly for risky behavior. Banks must also report their financial condition quarterly to regulators.

Despite these safeguards, failures still happen. Regulators cannot predict every market shock or management mistake. The 2023 failures showed that even well-known banks can run into trouble quickly. However, the FDIC insurance system has worked as intended — insured depositors have been protected in every failure since the agency was created in 1933.

Frequently Asked Questions

If my bank fails, will I lose all my money?

No. If your balance is under $250,000, the FDIC will pay you in full within a few business days. If your balance is above $250,000, you will receive the insured $250,000 right away, and the uninsured portion will depend on how much the FDIC recovers from the bank's assets. Most depositors in recent bank failures have recovered all or nearly all of their money.

Does FDIC insurance cover my money market account or CD?

Yes. Money market accounts and certificates of deposit are insured as savings accounts, up to $250,000 per depositor per bank. If you have both a savings account and a CD at the same bank, they share the same $250,000 limit. A CD at a different bank is insured separately.

What if I have money in an online bank — is it still FDIC-insured?

Most online banks are FDIC-insured, but not all. Check the bank's website for the FDIC logo or search the Bank Find tool at banks.fdic.gov. Online banks that are FDIC-insured offer the same protection as brick-and-mortar banks, even though you cannot walk into a branch.

Can I lose money if my bank is bought by another bank?

No. When one bank buys another, depositors are not harmed. Your account simply transfers to the new owner, and your FDIC coverage continues. This is different from a failure — in a merger, the acquiring bank has the money to pay all depositors.

How much does FDIC insurance cost?

FDIC insurance is free to depositors. Banks pay a small fee to the FDIC based on the size of their deposits. You do not pay anything to be insured, and you do not need to sign up — all deposits at FDIC-insured banks are automatically covered.