exactly how risk-free a bank is rated. The FDIC determines this price from 1 to 5. A 1 or 2 is noise and a 5 lender will fail in per year.
A rating for the safety and soundness of a bank, when it comes to a formula produced by the Federal Deposit Insurance Corporation (FDIC). The FDIC rates banking institutions on a scale of just one to 5. reviews of just one and 2 indicate that a bank is sound. Score of 4 and 5 indicate that a bank has serious problems. A rating of 5 is assigned to finance companies which have a high possibility of a failure over the following 12 months.