If you were to walk in to say the New York city branch of a major bank that you have an account with in the countryside then you'd be looking at a completely different situation.
I once borrowed E100K from my bank just on my promise that I would pay it back within 7 days. That would have been a lot harder if I had not been a very good customer of theirs for more than a decade.
But I still doubt they'd let me past the 'no customers beyond this sign', simply because they have a duty to safeguard the privacy of their other customers, even if we'd have a higher than normal level of trust between ourselves as people.
Your right; that's why I don't do much business with large banks ;).
I have one account with a large bank. I have not had any problems, but I limit my transactions with them to well documented transfers and have standing orders to not allow any other type of transactions.
I have no expectation that a large bank will cover my liability better than they cover theirs. I engage with them accordingly.
The best way to spread your risk with banks is to make sure you never have more than your federally insured cap with any one bank. (that's a luxury problem though). Over that and you're up the creek without a paddle if anything should happen to that bank.
The funny thing here is that the people that the bank owes money over that amount are ruthlessly culled, but the people that owe the bank are not.
I think that should cut both ways, in other words if a bank folds then both the debts and the deposits should be capped or none. But it seems to be completely asymmetrical to keep the people that owe the bank on the hook while capping those with whom the bank is in debt.
If you were to walk in to say the New York city branch of a major bank that you have an account with in the countryside then you'd be looking at a completely different situation.
I once borrowed E100K from my bank just on my promise that I would pay it back within 7 days. That would have been a lot harder if I had not been a very good customer of theirs for more than a decade.
But I still doubt they'd let me past the 'no customers beyond this sign', simply because they have a duty to safeguard the privacy of their other customers, even if we'd have a higher than normal level of trust between ourselves as people.