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Bank Safety in the post CFPB and FDIC protection era

larryB
edited February 25 in Other Investing
It’s obvious to anyone with half a brain that the robust protection afforded to small investors and depositors by the federal government are so 2024. To those of us who feasted on 5+% CD’s that are maturing now and in the near future bank ratings that might have been overlooked in light of FDIC protection can no longer be overlooked. Anyone have knowledge of the bank safety rating agency who is a HARD GRADER? You know what I mean,,,, like the opposite of life insurance rater A. M Best. Taking this further,,, would a “too big to fail bank” with a C- Weiss rating be safer that a Main Street Bank of Podunk Red State with a higher rating?

Comments

  • WABACWABAC
    IIRC, all of the major rating agencies went along with the foolishness that lead into the Great Recession. That's the main reason I decided I didn't want to be in funds focused on securitized debt, i.e., CLO's.

    I took a look at the Weiss home page. I notice they rate Bitcoin at A and BRKB at B+. After that observation I didn't bother to look into their methodology.
  • larryB
    @WBAC. Thanks for that info. So far all I have come up with is safety in diversity in lieu of relying just on ratings or counting on the FDIC to backstop CD’s.
  • sma3
    I think this is only the tip of the iceberg. A friend's daughter works at DOJ shutting down awful internet scams. Has saved Billions. She is probably going to be fired.
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