State bank (United States)

A state bank in the United States refers to a financial institution chartered and regulated by a state government rather than the federal government. State banks offer banking services to the public, similar to nationally chartered banks, but operate under the laws and oversight of their respective states. This includes accepting deposits, making loans, and providing other financial services.

State banks are supervised by state banking agencies, which are responsible for ensuring the banks' safety and soundness, compliance with state laws and regulations, and protection of depositors. While regulated at the state level, most state banks are also members of the Federal Deposit Insurance Corporation (FDIC), providing deposit insurance to customers up to the FDIC limit.

The structure of state banking regulations varies across states, reflecting different approaches to banking supervision and consumer protection. State-chartered banks are often seen as more closely attuned to the specific needs and conditions of their local communities, allowing them to offer specialized services or focus on particular sectors. However, they are subject to the regulations of their specific state, which might differ from the federal regulations applicable to national banks.

The distinction between state and national banks is a fundamental aspect of the dual banking system in the United States. This system allows banks to choose whether to be chartered and regulated by the federal government or by a state government. This dual system has been a feature of the U.S. banking landscape since the National Banking Act of 1863 and the establishment of the national banking system.