Question

If the bank at which you keep your checking account is owned by foreigners, should you worry that your deposits are less safe than if the bank were owned by Americans?

Short answer

You do not have to be concerned about keeping your account in a Saudi-owned bank since it is regulated the same as an American-owned bank.

Step-by-step solution

Concept Introduction

Whether it's a local bank or a bank owned by foreigners, they are all regulated and constantly monitored by the federal bank. Federal banks ensure the proper functioning of all banks through various tools like quantitative measures and qualitative measures (moral suasion) and ensure transparency and accountability.

Explanation

Whether it is safer to have to check an account in a bank that is owned by Americans rather than Saudi-Arabians cannot be said unambiguously.

If we look back in history as well as if we look in the recent times there are a huge number of cases of bank failure throughout.

The recent global financial crisis too according to many has originated in the banking and finance industry of the United States.

Final Answer

Although U.S banking industry has grown to power immensely it has been fragile. Therefore it is not right to claim that U.S banks are safer than that of Saudi-Arab.