What is a deposit network?

The NBID deposit network is a group of banks working together to help one another grow deposits and client relationships. The network is a powerful tool that helps banks provide accounts the make funds eligible for extended insurance through participating institutions, source funding, and manage their balance sheets.

Through the network, banks can provide accounts that make funds eligible for extended deposit insurance beyond the standard $250,000 Standard Maximum Deposit Insurance Amount set by the FDIC. The accounts work by distributing a client's deposits across multiple insured banks within the deposit network, offering extended insurance coverage eligibility in excess of $250,000 through a single Insured Sweep Account at your bank. Normally, when a bank utilizes the NBID network to provide insurance, they enter a reciprocal arrangement, where they receive the same amount of deposits back from the network as they have swept in to the network, which ensures they do not lose deposits in aggregate.

Banks can also source funding and sweep excess liquidity through the network to manage their balance sheets. Banks with excess deposits can put those idle funds to work, sweeping them off their balance sheets to reduce balance sheet size and earn fee income.

Banks in need of liquidity can also easily source overnight or term funds on demand to strengthen their balance sheets and sustainably fuel asset growth.

*Insurance provided by program banks (subject to meeting certain conditions)