How the CDARS Program Can Protect Your Business Wealth

April 22, 2024

Non-Deposit Investment Products are: not insured by the FDIC; not a deposit or other obligation of, or guaranteed by, the bank; subject to investment risks, including possible loss of the principal amount invested.

Building your business takes years of hard work and dedication. Protecting your hard-earned business wealth requires the same amount of effort. However, you may not have the time to focus on everything required to preserve wealth.

Business owners need reliable solutions to safeguard their company’s liquid assets, especially with constant market fluctuations and economic uncertainties to consider.

One of the most effective financial strategies for protecting business wealth is utilizing the Certificate of Deposit Account Registry Service (CDARS). This program offers a safe, convenient way to secure and grow your company’s assets.

Learn how the CDARS program works, the benefits it provides, and why Texas Gulf Bank is the ideal banking partner you need to help protect your business wealth.

The Basics of the CDARS Program

The Federal Deposit Insurance Corporation (FDIC) is a United States government agency that provides deposit insurance coverage for depositors of FDIC-insured banks.

The FDIC standard maximum deposit insurance limit is $250,000 per depositor, per ownership category at each FDIC-insured bank. Anything over the maximum deposit insurance amount is considered uninsured, meaning the individual or business could lose access to funds that exceed the FDIC standard limit.

CDARS is a strategic financial tool designed to provide business owners with asset security without sacrificing FDIC protection, liquidity, or growth opportunities. The program distributes large deposits across a network of participating banks and financial institutions – in increments that do not exceed the $250,000 FDIC coverage limit.

This automated and seamless process enables business owners to have multi-million-dollar FDIC insurance for their business wealth but with the total amount spread across multiple member banks. Although funds are deposited across various banks, you enjoy the convenience of one bank acting as the custodian, providing you with a streamlined management process.

Benefits of CDARS for Business Wealth

Utilizing the CDARS program for your business wealth may provide several key benefits that make it a valuable financial resource.

Financial Protection

A primary advantage of CDARS is the financial protection it offers to business owners who routinely make large deposits. The distribution of deposits across multiple member banks can minimize risk while ensuring that every dollar remains eligible for FDIC insurance (up to $50 million dollars total).

Growth Opportunities

Since large CDARS deposits are placed into CDs, your business wealth may continue to grow with low risk compared to other types of business investments. FDIC-insured banking ensures that any interest earned by these CDs also remains eligible for FDIC coverage.

Seamless Account Management

CDARS eliminates the need to manage multiple bank accounts and reporting processes by consolidating updates and balances into a single account statement. This streamlined reporting process lets business owners know the current account balance status, interest rates, and earned interest in real time.

Utilizing CDARS for company deposits and account management can make overseeing your business wealth a seamless and secure process. Having the right partner in your corner can help maximize the value of your company’s participation in CDARS.

Texas Gulf Bank: Your Trusted CDARS Partner

Protecting business wealth is a top priority for business owners – and our team at Texas Gulf Bank. We have been a reliable and strategic banking partner for businesses across the Southeast Texas Gulf Coast for over 110 years, providing the services and resources businesses need most.

When you choose Texas Gulf Bank as your CDARS custodian bank, you gain access to the following:

Banking Expertise: We have in-depth knowledge of the businesses and industries that call the Southeast Texas Gulf Coast home. Our team can provide expert guidance on leveraging CDARS most effectively for your needs.

Simplified Account Management: Our seamless integration of CDARS lets you focus on business growth. We provide thorough account statements that allow you to track balances and growth with ease.

Exceptional Customer Service: We build lasting client relationships to ensure a positive banking experience. As a local bank, we provide in-house customer service, so you have access to bankers ready to help.

Schedule a Call Today

Texas Gulf Bank has the experience and resources to help your business manage CDARS deposits and account information. We recommend working with our seasoned team to find the right solution that may help protect, manage, and grow your business wealth.

Contact Texas Gulf Bank today to schedule a call with our Treasury Services team. Learn how we can help you utilize the CDARS program to meet your business goals.

*CDARS is a registered service mark within the IntraFi Network, LLC