Due Diligence
ComplianceCorporateFinanceLegalMarch 20, 2023

Due Diligence Checklist: Proactive Steps for Avoiding a Bank Failure

The recent wave of bank failures in the United States has put a new focus on the security and stability of financial institutions. Even with protections in place, a bank’s failure is disruptive to individual and corporate customers, causing delays and confusion regarding access to funds.

These protections are also available only after-the-fact (i.e., after the failure of a bank), rendering it that much more critical that customers take the necessary precautions to avoid needing those protections. The safest course of action is to do your own due diligence and distribute your risk.

Wolters Kluwer Legal & Regulatory U.S. has prepared a Due Diligence Checklist that sets out what to look for and what to ask about when conducting your own due diligence. It identifies proactive steps you can take to gauge how sound a bank is, and whether it is stable enough to merit your initial business or continued business.

The Due Diligence Checklist covers the following key considerations:

  • Assess the Overall Health of Your Bank
  • Review Your Bank’s Investments.
  • Ensure Your Bank Participates in Stress Tests
  • Protect Your Deposits Beyond FDIC Depositor Protection
  • Regularly Monitor Your Bank for Material Changes
Download Checklist
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