‘We are highly regulated and diversified’: Central Texas banks reassure local customers after recent bank failures in CA, NY

Published: Mar. 14, 2023 at 1:09 PM CDT
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WACO, Texas (KWTX) - A local banker and a financial analyst say Central Texas residents should rest assured about the safety of their deposits in local community banks in the wake of recent bank failures in California and New York, explaining those failures were unique situations involving banking that catered to specialized industries.

The Federal government this week seized two U.S. banks that collapsed over the weekend and the Biden administration is working to shore up confidence in the system. “Your deposits will be there when you need them,” Biden told Americans on Monday, also adding the banking executives responsible for the failures would be held accountable.

Regulators closed Silicon Valley Bank last Friday after depositors rushed to withdraw their funds all at once. New York-based Signature Bank was seized by regulators late Sunday.

Closer to home, local banks echoing the president’s message. David Littlewood, with TFNB Bank in Waco, said Central Texans should not be concerned about the recent bank failures.

“(The failures in California and New York) are a very unique situation,” said Littlewood, “Those banks are bigtime outliers in the realm of what they specialize in. For Signature Bank, cryptocurrency is their primary specialty. And for Silicon Valley Bank, their specialty is tech, startup techs, primarily, and that’s a very specialized type of business.”


Littlewood told KWTX community banks like TFNB are “diversified in their risk, and diversified in their deposit base.”

“We are all very highly regulated and so it’s an interesting concept to me to try and dig in and figure out the standards that we’re held to and the diversification that we are required to have in how we do businesses,” Littlewood explained, “We could have never specialized in a specific industry to the degree that these two (Signature and SVB) were involved in.”

CBS News has learned Silicon Valley Bank was operating without a “chief risk officer” for months before one was hired in January.


“This was a very isolated situation. Signature Bank bet the wrong way on some crypto and Silicon Valley went the wrong way on some bonds, and word got out on social media, and that drove a run on the bank,” explained Dr. Ray Perryman, a longtime financial analyst with the Perryman Group.

“Those are unique situations and unique situations that delve into those areas and to the best of my knowledge the banks in Central Texas are well capitalized and very well run,” Perryman told KWTX.

“The banking system, as a whole, I think this is just fine. This is not another meltdown,” Littlewood said.

CBS News says President Biden intends to ask congress and banking regulators to strengthen the rules for banks to stave off future failures.