We only utilize the nation’s largest and strongest insurance carriers (with extremely high credit ratings) to issue Depositor Bonds. The ratings of these carriers are the strongest type of security next to U.S. government obligations. Credit ratings of each carrier are constantly monitored by S&P, Moody’s, A.M. Best, and the U.S Treasury. […]
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Improve Liquidity & Stress Tests
A primary benefit of Depositor Bonds is the release of a bank’s Tier 1 capital when assets are no longer pledged to secure deposits, which also improves stress tests from regulators. […]
Diversify Your Collateral Options
We believe it’s prudent for banks to have a diversity of collateral options including U.S. Government Securities, FHLB LOCs, CDARS, and Depositor Bonds. Collateral optionality provides increased flexibility for Treasury and Liquidity operations as market conditions fluctuate. […]
Reduce Costs & Market Risk
Depositor bonds are stable, cost effective credit instruments which only have a premium charge by the insurance carrier. They do not have market value fluctuations, and do not require any hedging activities to protect their value. When evaluated against the total transfer cost pricing of other collateral options, they are extremely competitive and normally cost […]
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