IntraFi Network Deposits

What is IntraFi Network Deposits CD Option?

IntraFi Network Deposits CD Option (IND-CDO), formerly known as CDARS, is one of the safest, smartest vehicles for investors looking to protect their large-dollar deposits while earning CD-level returns. CDs placed through IND-CDO offer:

• access to multi-million-dollar FDIC insurance;
• the ease of working through one trusted relationship, earning one rate per maturity, and receiving consolidated statements;
• relief from ongoing collateralization—because IND-CDO deposits are eligible for FDIC protection, you can eliminate ongoing collateral tracking;
• a finite maturity date (in contrast to auction-rate or some adjustable-rate securities); and
• the ability to have the amount of your deposit available to support lending initiatives that strengthen the local community.¹

How can deposits greater than the standard FDIC insurance maximum ($250,000) be insured by the FDIC?

The standard FDIC insurance maximum is $250,000 per insured capacity, per bank. To protect a larger deposit, you could run around to multiple institutions to deposit your funds, or you could require a bank to collateralize your deposit and track changing collateral values on an ongoing basis.

Alternatively, you can have us place your large-dollar deposit using IND-CDO. Your deposit is divided into smaller amounts and placed with other institutions that use IND-CDO, each an FDIC-insured institution. Then, those member institutions issue CDs in amounts under $250,000, so that your deposit is eligible for FDIC insurance at each member bank. By working directly with us, you can access coverage from many institutions while receiving a single regular statement.

Who has custody of my funds?

Funds placed through IND-CDO are deposited only into FDIC-insured banks. We act as custodian for your IND-CDO deposits, and the sub-custodian for IND-CDO deposits is the Bank of New York Mellon (BNY Mellon).

Unique to IND-CDO, you as a depositor can obtain a confirmation of records maintained by BNY Mellon as sub-custodian to reconcile those records with the statements received from us. At any time, as often as desired, you as a depositor can obtain a certified statement from BNY Mellon that confirms the exact amount of your CDs, including principal balance and accrued interest, for each FDIC-insured institution that issues a CD through IND-CDO. 

You can submit a request for the certified statement, along with BNY Mellon’s processing fee, through us. BNY Mellon will send the certified statement directly to you or to another party designated by you, such as an auditor.

How can my funds be used locally if my CDs are issued by financial institutions across the country?

When we exchange deposits with other institutions that use IND-CDO on a dollar-for-dollar basis, the same amount of funds placed through the network returns to us. As a result, the total amount of your original deposit can remain with our bank and be used for local lending. (IND-CDO Reciprocal transactions only.)¹

Is my account information safe?

You work directly with just us—the bank you know and trust. As always, your confidential information remains protected.

What happens if a IND-CDO institution that holds my deposit fails?

Most of the banks that have failed in the United States in recent years did not use IND-CDO or did not hold any IND-CDO deposits when they failed. When a IND-CDO institution has failed, the bank’s CDs issued using IND-CDO in most cases have been transferred to a healthy institution—the FDIC’s preferred method for handling bank failures. In cases where the FDIC has been unable to find a healthy institution willing to accept such a transfer, it has arranged for the payment of the insured principal and accrued interest to the depositors. This payment has usually occurred within a matter of days.