AMERICA - Novel Idea, A State Owned Bank

Live and learn. Didn't know about this until I read a Newsgroup article recommend this as a partial economic-fix for all states.

"Bank of North Dakota"

The Bank of North Dakota (BND) is a state-owned and -run financial institution based in Bismarck, North Dakota. Under state law the bank is the State of North Dakota doing business as the Bank of North Dakota.

All state and local government agencies are required to place their funds in the bank. Other entities may also open accounts at the Bank; however, BND offers fewer retail services than other institutions, and has only one office, limiting its competitiveness in consumer banking.

Instead, BND has taken a role more akin to a central bank, and has many functions, such as check clearing, that might be expected from a branch office of the Federal Reserve. The Bank does have an account with the Federal Reserve Bank, but deposits are not insured by the Federal Deposit Insurance Corporation, instead being guaranteed by the State of North Dakota itself.

BND also guarantees student loans (through its Student Loans of North Dakota division), business development loans, and state and municipal bonds.

Though initially conceived by Non-Partisan League populists as a credit union-style institution to free the farmers of the state from predatory lenders, the Bank's functions were largely neutered by the time of its inception by the business-backed Independent Voters Association. The recall of NPL Governor Lynn Frazier effectively ended the initial plan, with BND taking a more conservative central banking role in state finance. The current president and CEO is Eric Hardmeyer.

The Bank of North Dakota is the only state-owned facility of its type in the nation, other than the Puerto Rico Government Development Bank.

Bank of North Dakota WEB page