Non member banks

Non member banks DEFAULT

Number of Suspended Banks, Non-Member Banks of the Federal Reserve System for United States (M09038USM155NNBR)

Source:National Bureau of Economic Research  

Release:NBER Macrohistory Database  

Units:  Number, Not Seasonally Adjusted

Frequency:  Monthly


Data Reflect Banks Closed On Account Of Financial Difficulties By Order Of Supervisory Authorities Or By Directors Of The Bank. Data Include Banks Subsequently Reopened, But Do Not Include Voluntary Liquidations. The Coverage Ends In February 1933, Due To Banking Legislation Enacted In March Which Renders Further Data Incomparable (The Emergency Banking Act). In The Autumn Of 1931, The National Credit Corporation Was Formed Under The Sponsorship Of Banks, To Make Loans To Banks In Difficulty. In February 1932, The Reconstruction Finance Corporation Was Formed, Leading To A Reduction In The Rate Of Suspensions (See 1932 Report). Source: Federal Reserve Board, Annual Reports, 1932, Pp. 152-154, And 1933, P. 223.

This NBER data series m09038 appears on the NBER website in Chapter 9 at

NBER Indicator: m09038

Suggested Citation:

National Bureau of Economic Research, Number of Suspended Banks, Non-Member Banks of the Federal Reserve System for United States [M09038USM155NNBR], retrieved from FRED, Federal Reserve Bank of St. Louis;, October 18, 2021.


Non-Member Banks

Non-Member Banks,

Non-Member Banks:

Meaning of Non-Member Banks: A non-member bank is a bank that is not a member of the Federal Reserve. Like member banks, non-member banks are subject to the required reserves, which must be maintained by depositing one percent of their reserves in Bank of America reserves. Although non-member banks are not required to purchase shares of the Federal Reserve Bank in their district, they also have the services offered by the Federal Reserve, such as its discount window, on the same terms as bank members.

  • A non-member bank is a bank that is not a member of the US Federal Reserve system, usually a state-licensed bank.
  • State-licensed banks may ultimately choose not to join the Fed because state laws and regulations under the Federal Deposit Insurance Corporation (FDIC), which oversee non-member banks, may be less burdensome.
  • Other examples of non-member banks are West Bank and GMC Bank.

Literal Meanings of Non-Member Banks


Meanings of Non:
  1. Rejection or absence of expression

  2. Negative neutral expression when there is a special meaning (e.g., inhuman or dehumanized) of them or of a particular form beginning with them.

Sentences of Non
  1. No aggression

  2. Non slip


Meanings of Member:
  1. People, animals or plants that belong to a particular group.

  2. Blocks of complex structural buildings.

  3. Organs or organs of the body, especially the limbs.

Sentences of Member
  1. Public interest

  2. The central element that connects the front and rear axles

  3. The skeleton, which is made up of about 200 bones, is similar to the body, divided into head, trunk and extremities.

Synonyms of Member

part of the body, factor, feature, piece, constituent, attribute, portion, component, organ, part, element, limb, unit


Meanings of Banks:
  1. Accumulated in a mass or pile (of a substance).

  2. (In the case of airplanes or vehicles) Lean or lean when turning.

  3. (From locomotive) provides extra energy to (train) going up the hill.

  4. (A fisherman) manages to land (fish)

  5. Throw it (into the ball) so that it bounces on the surface like a pillow.

  6. On a river or lake or on a hill.

  7. A long, long, wide or pile of matter.

  8. A collection of similar items, especially electrical or electronic equipment, grouped in a row.

  9. Pool table cushions.

  10. Bank deposit (money or valuables)

Sentences of Banks
  1. The rain piled on the ground behind the door

  2. The plane overturned as if on its way back to the airport

  3. Construction of a four-cylinder locomotive for a bank train on Lucky Hill

  4. It was the largest rainbow pirate ever

  5. I put eight balls on two pillows

  6. The Wolves stood by the river

  7. Grass bench

  8. The DJ has lots of lights and speakers on both sides of the console

  9. Bankruptcy

Synonyms of Banks

bound, pitch, margin, border, angle, flank, rise, heap, levee, stack, be at an angle, boundary, make a stack of, incline, perimeter, brink, financial institution, limits, fringes, stack up, lean, dip, fringe

  1. Hampton building permits
  2. Patterson tyler hyundai
  3. Boardview schematic
  4. Windsurfing trailer

Nonmember bank

Senator Glass argued that the eligibility provisions could lead to "two billions of dollars of these acquired [RFC] securities in the lap of the Federal Reserve System." (122) Glass worried that the discount and advances provisions would "practically repeal here that provision of the Federal Reserve which precludes any nonmember bankfrom using, directly or indirectly, the rediscount privileges of the Federal Reserve System." (123) Since the RFC would borrow in the capital markets to finance its loans to nonmember banksand trusts, Glass suggested that Federal Reserve purchases, advances, and discounts involving RFC debt would give nonmember banksand trusts indirect access to Federal Reserve credit.


US Metro Bank is a California chartered, full service commercial nonmember bankheadquartered in Garden Grove, California with three branch offices in California - Garden Grove, Anaheim and Koreatown/Los Angeles and loan production offices in Dallas, Texas and Seattle, Washington.

US Metro Bank announces Q3 2017 financial results

As a result, Senator Hardwick of Georgia introduced an amendment that would have added to Section 16 the proviso that nothing in the Act shall be construed as prohibiting a member or nonmember bankfrom "making reasonable charges, but in no case to exceed 10 cents per $100 .

The Fed's entry into check clearing reconsidered

The Federal Reserve Board on August 24, 2004, announced the issuance of a consent notice of prohibition against Charles Kushner, an institution-affiliated party of The NorCrown Trust, an unregistered bank holding company that owns or controls the shares of the NorCrown Bank, Livingston, New Jersey, a state nonmember bank.

Enforcement actions

(1.) Immediately after North Fork' s acquisition of Commercial Bank, North Fork's lead subsidiary bank, North Fork Bank, Melville, New York, a state-chartered nonmember bank, would acquire substantially all Commercial Bank's assets and assume substantially all Commercial Bank's liabilities.

Orders issued under Bank Holding Company Act. (Legal Developments)

To test this hypothesis, the authors regress deposits in failed nonmember banksin each state on dummy variables indicating whether a state was represented on the House or Senate Banking Committees.(72) They find that nonmember banklosses were higher if a state had a representative on the House Banking Committee.

Monetary policy in the Great Depression: what the Fed did, and why

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NBFC(Non Banking Financial Company) vs Scheduled Commercial Bank - NBFC और Banks में क्या फर्क है?

Help - Institution Categories

Other Institution Type Definitions

Domestic Branch of a Domestic Bank

A branch office of a commercial bank, both of which are physically located in the United States.

Domestic Entity Other

Institutions that are physically located in the United States, which engage in banking activities, usually in connection with the business of banking in the United States.

Data Processing Servicer

Entities primarily engaged in providing infrastructure for hosting or data processing services. These establishments may provide specialized hosting activities, such as web hosting, streaming services or application hosting, provide application service provisioning, or may provide general time-share mainframe facilities to clients. Data processing establishments provide complete processing and specialized reports from data supplied by clients or provide automated data processing and data entry services.

Finance Company

A financial intermediary that makes loans to individuals or businesses.

Foreign Bank

An organization that is organized under the laws of a foreign country and that engages directly in the business of banking outside the United States.

Foreign Banking Organization (FBO)

A foreign bank that operates a branch, agency or commercial lending company subsidiary in the United States, controls a bank organized under U.S. law, or controls an Edge or agreement corporation, and any company of which a foreign bank is a subsidiary.

Foreign Banking Organization as a BHC

A foreign banking organization that also acts as a bank holding company and is thus supervised by the Board of Governors of the Federal Reserve.

Foreign Branch of a U.S. Bank

A branch that resides outside of the United States, but has a parent that is located in the United States.

Foreign Entity Other

Institutions that engage in banking activities, usually in connection with the business of banking, in foreign countries where such institutions are organized or operating.

Insured Branch of an FBO (Federal and State)

A branch that accepts retail deposits which are insured by the Federal Deposit Insurance Corporation.

Investment Bank/Company

Acts as an underwriter or agent that serves as intermediary between the issuer of securities and the investing public.

National Bank

A commercial bank whose charter is approved by the Office of the Comptroller of the Currency (OCC) rather than by a state banking agency. National banks are required to be members of the Federal Reserve System and belong to the Federal Deposit Insurance Corporation.

Non-Member Banks

Commercial banks that are state-chartered and NOT members of the Federal Reserve System. Include all insured commercial banks and industrial banks.

State Member Banks

Include all commercial banks that are state-chartered and members of the Federal Reserve System.


An organization that primarily accepts savings account deposits and invests most of the proceeds in mortgages. Savings banks, savings and loan associations, and credit unions are examples of thrift institutions.

Uninsured Agency of a FBO (Federal and State)

An uninsured agency does not accept retail deposits and needs not apply for federal deposit insurance.

Uninsured Branch of a FBO (Federal and State)

A branch that does not accept retail deposits and needs not apply for federal deposit insurance.


Banks non member

What is the advantage of putting your money in a Fed member bank versus a bank that is a nonmember? How do you know which banks are Fed members?

As of mid-year 2003, there were 7,831 commercial banks in operation throughout the United States. This includes large banks, with many branches nationwide, as well as small community banks. Together, these institutions held about $4.25 trillion in deposits.

Fed Members and Nonmembers: What's the Difference?
What is the distinction between commercial banks that are members of the Federal Reserve System and those that are nonmembers? As stated in Fed in Brief:,

National banks chartered by the federal government are, by law, members of the Federal Reserve System. State-chartered banks may choose to become members of the Federal Reserve System if they meet the standards set by the Board of Governors. Each member bank is required to subscribe to stock in its regional Federal Reserve Bank, but holding Federal Reserve stock is not like holding publicly traded stock. Reserve Bank stock cannot be sold, traded, or pledged as collateral for loans. As specified by law, member banks receive a six percent annual dividend on their Federal Reserve Bank stock; member banks also vote for Class A and Class B directors of the Reserve Bank.

Of the total number of commercial banks in operation as of mid-year 2003, 2,999 were members of the Federal Reserve System. As Chart 1 illustrates, although there were fewer member banks, these institutions held a significant share of the nation's deposits. In other words, on average, member banks tend to be the larger institutions.1

Payments Services Are Available to Both Member and Nonmember Banks
Both member and nonmember banks may use some of the financial services sold by the Federal Reserve. Included in these Fed-provided payments system services are check clearing, electronic funds transfers, automated clearing house payments, and coin and currency services.

Chart 1

Members and Nonmembers: A Consumer's Point of View
As is illustrated in Chart 1, if you choose to bank at a member institution, you will likely be choosing a larger bank with many branch locations. Alternatively, if you choose to hold an account with a nonmember bank, you'll typically be choosing a smaller institution with fewer branch locations.

How Do You Know if your Bank is a Member or a Nonmember?
If you are the curious type, the easiest way to find out if your Bank is a Fed member or a nonmember is to contact your Bank and simply ask about the bank's charter type. Another way is to explore your Bank's web site to see if its charter type is mentioned. Remember, both national banks and state member banks are considered "member" banks.

Don't Forget FDIC Insurance!
As a consumer of banking services, you may have also heard about Federal Deposit Insurance Corporation (FDIC) deposit insurance. In the event that a bank, savings and loan, or mutual savings bank is forced to close, accounts are protected by FDIC insurance up to the current legal limit of $100,000 per depositor. Both member and nonmember banks have the option to provide FDIC insurance to their customers, and virtually all do. You can find out if your bank is insured and if your deposits are insured by contacting your institution or visiting the FDIC web site. Of course, there are certain investments that aren't covered under deposit insurance such as mutual funds or treasury securities. For more information about investments that aren't covered by FDIC insurance, visit the FDIC's Uninsured Investments section.


1. The Monetary Control Act of 1980 reformed reserve requirement rules so that all depository institutions regardless of membership in the Federal Reserve System—commercial banks, savings banks, savings and loans, credit unions, U.S. agencies and branches of foreign banks, and Edge Act and agreement corporations—must hold some level of reserve requirement based on deposits. The reserve requirement is set by the Federal Reserve.

Additional Resources

Bank Lists for the Twelfth Federal Reserve District, Federal Reserve Bank of San Francisco.

Bank Peer Group Performance, Federal Reserve Bank of Kansis City.

How to File a Consumer Complaint About a Bank, Federal Reserve Board.

"Mutual Funds: Understanding the Risks." VHS video format. 1997.

The Federal Reserve System In Brief. Federal Reserve Bank of San Francisco. Revised March 2004.

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May 16, 1940 Revision of the Securities Acts
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Dec. 11, 1934 Proposals for a Government-Owned Central Bank
Sep. 12, 1934 Bank Reserves and Credit Inflation
Nov. 27, 1933 Bank Credit in Depression and Recovery
Aug. 12, 1933 Closed Banks and Banking Reform
Apr. 04, 1933 Unified Control of Banking
Apr. 09, 1932 The Glass Banking Bill
Mar. 24, 1932 The Guaranty of Bank Deposits
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Jan. 31, 1924 The Northwestern Bank Failures and the Attack on Treasury Savings Certificates
Dec. 01, 1923 Why State Banks Do Not Join the Federal Reserve System, the Effect on the System and the Issues Involved
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Non-Member Banks

What Are Non-Member Banks?

Non-member banks are banks that are not members of the U.S. Federal Reserve System. As with member banks, non-member banks are subject to reserve requirements, which they have to maintain by placing a percentage of their deposits at a Federal Reserve Bank. Although non-member banks are not required to purchase stock in their district Federal Reserve banks, they still have access to services offered by the Federal Reserve, such as its discount window on the same terms as member banks.

Key Takeaways

  • Non-member banks refer to banks that are not members of the U.S. Federal Reserve System, typically state-chartered banks.
  • State-chartered banks may ultimately decide to refrain from membership under the Fed because regulation can be less onerous based on state laws and under the Federal Deposit Insurance Corporation (FDIC), which oversees non-member banks.
  • Other examples of non-member banks include the Bank of the West and GMC Bank.

How Non-Member Banks Work

Non-member banks can only be state-chartered since all nationally-chartered banks necessarily have to be members of the Federal Reserve System. One reason that state-chartered banks may decide to refrain from membership is that regulation can be less onerous, some believe, under the Federal Deposit Insurance Corporation (FDIC), which oversees non-member banks rather than the Federal Reserve Banks (member banks report to regional Federal Reserve banks).

Depending on where they are located, non-member banks are only subject to state laws, rather than federal laws, so they may opt for less-regulated operations in a state like North Dakota. In addition, they are able to keep at least a part of their reserves in interest-bearing securities. Non-member banks, like members, still receive services from the Federal Reserve System, including check clearing, electronic funds movements, and automated clearing house payments.

Becoming a member is only a matter of submitting an application, fulfilling the requirements, and going through a waiting period. Some non-member banks deliberate on this decision carefully and engage in the process in measured steps if they believe that being a member is ultimately more beneficial than remaining a non-member. There are also examples of, in extreme cases, non-member banks deciding to change their status to take advantage of certain benefits of becoming part of the U.S. Federal Reserve System.

Examples of Non-Member Banks

In 2008, some non-member banks fled into the arms of the Federal Reserve System for protection. Such was the case with investment bank Goldman Sachs, which faced economic uncertainty during the financial crisis in 2008. The investment bank humbly sought and received member status to access the Fed's discount window and begin taking government-guaranteed deposits from the public. In a press release heralding its new status, the bank spun it this way: "We believe that Goldman Sachs, under Federal Reserve supervision, will be regarded as an even more secure institution with an exceptionally clean balance sheet and a greater diversity of funding sources."

Other examples of non-member banks include the Bank of the West, GMAC Bank, and the Bank of North Dakota.


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