Public Banks

ABA Position

The US has a healthy banking system with approximately 5,500 banks that offer a diversity of financial products and services to consumers, businesses and state and local governments. Creating a public bank would not only be redundant in the current marketplace, where financial offerings already efficiently meet customer needs, but potentially dangerous – placing taxpayer funds in institutions that may not have deposit insurance and whose business decisions will be driven by political priorities instead of sound risk management.

Numerous studies on the viability of public banks support the conclusion that they are not necessary, pose a significant risk to taxpayers, and would not provide an overall benefit to the state and local governments they are intended to serve.

Related Training & Events

ABA Experts Webinar: What You Need to Know about the CRA Final Rule
Recorded Webinar | November 3, 2023

The federal banking agencies have finalized the long-awaited overhaul of regulations that implement the Community Reinvestment Act. The new rule aims to reflect the digital delivery of financial products and services and enhance economic opportunity for low-and moderate-income individuals and communities. It also has strategic implications for banks that may affect your growth strategy and expansion into new markets.