Clients of JPMorgan Chase, Bank of America, and Wells Fargo accumulate trillions of dollars in uninsured deposits

In 2010, under the Dodd-Frank Act—passed by Congress in response to the 2008 financial crisis—the Federal Deposit Insurance Corporation (FDIC) increased its deposit insurance limit to $250,000. In other words, if you place your money in an FDIC-protected account and the bank fails, you are guaranteed to receive up to $250,000 of your deposits back. However, in one recent case, that of the failure of Silicon Valley Bank, the FDIC protected deposits above this level.

However, since 2010, the total amount of insured deposits within FDIC-protected accounts has continued to grow, reaching $7.61 trillion in the last quarter of 2024. In 2010, uninsured deposits accounted for only 20 percent of all deposits, but by 2022, that figure had risen to 44.7 percent. As the largest financial institution in the country, a sizable amount of the uninsured balances sit in JP Morgan Chase, Bank of America, and Wells Fargo accounts. Some outlets online have circulated that the amount owned by these three financial giants amounts to $2.6 trillion, but this figure could not be verified.

Growing uninsured deposits raise concerns

If a major bank failure were to occur, some account holders—particularly retirees and workers with their savings and retirement funds in these accounts—could face significant losses. The FDIC reported earlier this year that in the fourth quarter of 2024, uninsured deposits grew at a much faster rate than insured deposits:

The FDIC noted that this increase in uninsured deposits was widespread, with nearly two-thirds of banks (60.1%) reporting an increase. Looking at the annual change from the fourth quarter of 2023, uninsured deposits rose by 5.4% (+$393.3 billion), while insured deposits increased by just 0.5% (+$56.7 billion).

What does this increase mean?

The $250,000 FDIC insurance limit serves as a cutoff—any amount above this threshold is not guaranteed to be returned in the event of a bank failure. The rising share of uninsured deposits suggests that more funds are being held in accounts exceeding this limit, leaving a larger portion of depositors potentially vulnerable.

While the total value of insured deposits remains higher than when Dodd-Frank took effect, it has declined from its peak in the second quarter of 2022, when $8.76 trillion in deposits were FDIC-insured.

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