What Is a Niche Bank?

Niche banks cater to and serve the needs of a certain demographic segment of the population. Niche banks typically target a specific market or type of customer and tailor a bank's advertising, product mix, and operations to this target market's preferences.

How a Niche Bank Works

Niche banks are usually types of commercial banks, which accept deposits, extend loans, and offer basic financial products like🐻 certificates of deposit (CDs), checking, and savings accouꦗnts. 

Most niche and commercial banks stand in contrast to 澳洲幸运5开奖号码历史查询:investment banks, which specialize in larger and more complex financial transactions. These can include underwriting, being an intermediary between a securities issuer and the investing public, facilitating mergers, and other corporate reorganizations, and acting as a broker and/or financial advisor for institutio💖🍰nal clients.

Special Considerations

If you are considering a niche bank, it is important to make sure it is 澳洲幸运5开奖号码历史查询๊:Federal Deposit Insurance Corpo🤪ration (FDIC) insured. Created in 1933, the FDIC insures deposits in the U.S. against 澳洲幸运5开奖号码历史查询:bank failure. Today, theﷺ FDIC insures deposits of up to $250,000 per institution for all member firms.

The FDIC usually covers 100% of member checking accounts, savings accounts, 澳洲幸运5开奖号码历史查询:certificates of deposit (CDs), and 澳洲幸运5开奖号码历史查询:money market accounts. While the FDIC may at times cover aspects of some trust accounts and individual retirement accounts (IRAs), they do not cover investment products, such as mutual funds, 澳洲幸运5开奖号码历史查询:annuities, life insurance policies, stocks, or bonds. Nor are contents of m🎀ost safe-deposit boxes inc𒊎luded in FDIC coverage either.

It is also important to ensure that the niche bank is a separately chartered entity and not affiliated with a bank where you currently have de💮posits. This is due to 📖the fact that the FDIC generally limits deposit insurance to $100,000 per person per chartered institution.

Example of Niche Banks

Niche banks have moved beyond just mobile- or internet-only banks, such as 🔯Simple. Those banks are no longer specific enough to be considered niche, 𒈔as they’ve become more prevalent. 

A good exa🥂mple of a niche bank is the Golf Savings Bank, which sponsors golf tournaments and offers up to $10,000 for PGA members who score a hole in one and have a specific account at the bank.

Other examples of niche banks include Reid Temple AME Church Federal Credit Union, which has convenient hours before and after church on Sundays, along with BowieBanc, which offered an 澳洲幸运5开奖号码历史查询:automated teller machine (ATM) card with a picture of David Bowie befওore it shut down.

Meanwhile, Rho𓂃de Island-based Admirals Bank is a niche lender focused on septic systems. Oklahoma’s Bank 2 is a community bank that offers loans for manufactured homes.