How Safe Is My Safe Deposit Box?

by David P. McGuinn

What would happen to a safe deposit box if a financial institution was closed by the federal government? Unfortunately this question is being asked nationwide by many safe deposit customers. Representatives from the FDIC have provided the following information:

When a financial institution is closed, it is usually purchased by a stronger financial organization. Most accounts, deposits, and assets are assumed by the new owners. When this happens, access to a customer's safe deposit box is usually permitted on the next business day.

When a financial institution is closed and not purchased by another organization, FDIC will become the new owner. When this happens, access into a customer's safe deposit box could be delayed from one to four days. This time period is required by FDIC to examine and close the books of the failed institution. When this final accounting is complete, FDIC will request that all renters come in and close their safe deposit box.

In either situation customers should be assured that FDIC does not care or want to know what they have in their safe deposit box. The frequency of this question should indicate a vary valid customer concern regarding the security, confidentiality, and accessibility to safe deposit box contents.

If you are asked this question, try to reassure the customer that their safe deposit box is usually not affected by the government action in closing a financial institution. It is still the safest place they can find to store and protect their valuables.

David McGuinn is President of Safe Deposit Specialists, Houston, Texas (713) 690-2926.

Copyright © 1991 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 2, No. 8, 10/91