I'm alarmed by the turmoil in the financial services industry. Should I be worried about my bank deposits?

I'm alarmed by the turmoil in the financial services industry. Should I be worried about my bank deposits?

Despite some high-profile bank failures and a recent government rescue plan, the banking industry as a whole is sound. And even if the unthinkable happened and your bank did fail, your deposits would be protected under a federally sponsored program that has existed since the Great Depression.

In 1933 , f ollowing a rash of bank failures, Congress created the Federal Deposit Insurance Corporation (FDIC). The agency's role was to maintain stability and public confidence in the American banking system. That's still its purpose today.

The FDIC insures deposits in the nation's 8,451 banks and savings associations by guaranteeing checking accounts, savings accounts, money market deposit accounts and certificates of deposit. The FDIC does not insure money invested in stocks, bonds, mutual funds, life insurance policies, annuities or municipal securities.

By all measures, the program has worked well. The FDIC notes that no depositor has ever lost a single penny of insured funds.

Historically, most insured deposits have been guaranteed up to $100,000 per depositor. In October, coverage got a temporary boost. Except for non-interest bearing accounts, deposits at FDIC-insured institutions are now covered up to $250,000 per depositor, while non-interest bearing accounts are covered for the full amount of the deposits.

Those increases are designed to remain in effect through Dec. 31, 2009. By that time, the government reasons, the increased coverage will have accomplished its goal: to restore confidence in the banking system and reduce turmoil within the financial markets.

While the FDIC sets limits on the amount of a deposit that is insured, a person may qualify for more than $250,000 in coverage if they own deposit accounts in different ownership categories.

For example, FDIC provides separate insurance for single owner accounts, joint accounts, Individual Retirement Accounts and trusts. Deposit accounts owned by corporations, partnerships, employee benefit plans, government entities and certain associations are also covered.

It's important to understand your insurance limits under the FDIC program. To find out more about FDIC and how it protects you, consult with your bank professional.

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Susan West is a Vice President and Retail Regional Manager with Fifth Third Bank. She welcomes the opportunity to take your comments and questions. Please feel free to contact her at 614-895-5750 or Susan.West@53.com.