|Finding Your Way Up a Bank's Chain of Command
(Part 3 in a 3-part Series)
In the first two articles in this series, we told you about disreputable practices that some banks engage in, and a few protective measures you can take. In this concluding article, we'll tell you who really has authority and how to make your voice heard. We’ll also explain FDIC insurance.
The lowest level bank employee who deals with the public is the Teller. Tellers have virtually no discretion as to rules, so don't bother trying. The Head Teller has some authority, but not much.
Platform officers (the people at desks in the main area of the bank) usually have the title of Assistant Vice President ("AVP"). In large banks there can be many, many AVPs so they are at a low level of management. However, they do have some authority.
The highest-level officer in a bank branch is the Branch Manager.
A Vice President ("VP") is above the branch level. A VP usually has authority over a specific area of bank operations, such as Residential Loans or Personal Checking. VPs are the lowest level executives who are likely able to make significant decisions.
Senior Vice President ("SVP") is just one level below President. Large banks have more than one SVP, but if you reach the SVP who has jurisdiction over the banking operation of concern to you, he or she should be able to resolve your dispute. Failing that, you can appeal to the President.
The President reports to the Board of Directors, but the President is almost always a member of the Board, and the Board rarely sides with a depositor. Furthermore, boards of directors do not meet very often.
If the bank refuses to resolve a matter to your satisfaction, you can complain to the bank's regulator.
Federally-chartered banks: If the bank name includes the words "National Bank" or "NA", it is regulated by the Office of the Comptroller of the Currency. If the name includes (1) "Federal" and "Savings", or (2) "FSLA" or"FSB", then it is regulated by the Office of Thrift Supervision (“OTS”), an agency of the U.S. Treasury.
State-chartered banks: In New Jersey, state-chartered commercial banks are regulated by the FDIC (Federal Deposit Insurance Corporation) if they are FDIC-insured, or by the Federal Reserve if they are a member of the Federal Reserve system. Those that are not FDIC-insured are regulated by the New Jersey State Banking Commission.
State-chartered savings banks are regulated by the OTS and, if they are FDIC-insured, also by the FDIC.
If the bank’s name does not include any of the above designations, or if you're not sure for any reason, you can always ask a bank officer who their regulatory agency is. They are required to tell you.
If you have access to the Internet, you can find any FDIC-insured bank's regulator through the Web site: http://www3.fdic.gov/idasp/main.asp (NOTE the “www3” at the beginning of the address).
Unless your matter is very simple, the best way to get action is to state your case in writing, regardless of whether you're dealing with a bank executive or a regulatory agency. Address the letter to a named individual. State only the facts, avoiding sarcasm, accusations or other emotional statements. Also, tell them what specific action you want them to take.
FDIC Insurance Limits
FDIC insurance reimburses depositors if the insured bank fails. FDIC insurance covers savings and checking accounts as well as CDs and certain other items such as cahiers' checks. Those items are known collectively as “Deposits”. It does not insure "investments" made through the bank, such as mutual funds. Similarly, if you own stock in that bank itself, the stock is not FDIC-insured.
Your deposits in any one institution (including all its branches) are insured up to $100,000. Retirement funds (IRA and Keogh) are insured separately from other deposits and are subject to their own $100,000 limit. Accounts you have jointly with another person are pro-rated between you.
The above is a synopsis of FDIC insurance rules. For details, you should consult the FDIC's publications. Those of you with Internet access can view the documents at:
The information in this article was validated by federal bank examiners.
W. A. Shapiro