Picking a bank?
How do I determine where to put the money that I want in a bank? Will balance sheets really tell me anything? Is there a simple way to see which banks might endure better than others?
This is not scientific by any means, but it was all I could come up with. I simply picked a local bank. I did look at the bank ratings at The Street.com for what they were worth- not much- to get a quick second opinion. From there I simply decided on a bank that was close by and convenient. I have very little in the bank and I don’t plan on keeping much there in the future either (out of circumstance, not desire). I also made sure before opening my new account that the bank had not recently accepted governmental bailout funds. The response I got was that the CEO didn’t want to be hindered by the government and that the bank didn’t need it in the first place. That was reassuring.
I’m now 3 months out from banking switch and I couldn’t be happier. I walk into the bank now and they know me and my family. The bank is not overly stuffy and the people there are intelligent. The whole system actually works better than my previous large regional bank also. In the end it’s not what is the absolute best option, but rather what is the best available option that is reasonable and convenient to your location. Best of luck,
Thanks, Patrick, for your sensible reply!
A couple easy ways to get insight into a bank’s health is to go to http://www.bauerfinancial.com and http://www.bankrate.com and look up the ratings. Absolutely stay away from anyone with a rating or 2 or less, preferably go with a 4 or 5. Banks are not legally allowed to divulge their CAMELS (so as to protect the weak banks from the public knowing that they are weak) but these ratings will reasonably approximate their CAMELS.
At this time one can reasonably assume that all of the giants and most of the larger regionals are insolvent or close to it, though with the regulators being complicit in allowing them to falsify their balance sheets and hide the bad debt. Some smalls are in big trouble too but your best bets are generally going to be local savings banks, cooperative banks, and credit unions. Most of the time they never had reason to get stupid like the big guys did. They typically stuck to the old fundamentals of banking rather than getting “creative”.
Yep. I have to say that credit unions are the way to go. I think you’ll like how you are treated.
I like the Credit Union idea — my wife has here account at one and they are first class
She also has a theory about restaurants — if the area around the door handle on the entry door is dirty ( even streaks on a glass door), don’t even enter — go find someplace else. I wonder if that works for banks also ?
Does someone know if credit unions are generally safer than FDIC-insured small an local for-profit banks?
And: Are there any other disadvantages?
A good resource I found: http://moveyourmoney.info/