FNBO Direct Online Savings Bank – Safe, Secure, & FDIC Insured

September 30, 2008

FNBO Direct Online Savings

FNBO Direct offers one of the best rates available for a high yield savings account and unlike many other banks is not in danger of failing.  In fact, at First National Bank of Omaha, deposits are growing and the number of customers is increasing during these troubled economic times.  So why is FNBO Direct remaining profitable and protecting your money while so many other banks are going under?

FNBO Direct Protects Your Money

Rajive Johri, the president of the First National Bank of Omaha, recently wrote a letter to customers explaining that the bank still has a strong and well diversified balance sheet since it avoided subprime mortgages and was not invested in the securities that are tied to subprime mortgages.  As he puts it:

“Our culture of strong, disciplined lending and focus on the communities we serve ensures our continued vitality.”

While many of the banks on Wall Street were repackaging “toxic debt” via collateralized debt obligations and derivatives, First National Bank was using the disciplined lending strategy that Johri refers to; which helped them avoid a lot of downside risk of the bad debt.

Best Banks Manage Risk

One interesting thing about Johri is that before becoming president of First National Bank he was an Executive Vice President at J.P. Morgan Chase for five years.  He must have learned a lot at a J.P. Morgan Chase about managing risk, J.P. Morgan seems to be weathering the financial storm okay so far, recently buying up Washington Mutual, and FNBO Direct is growing while other banks are losing deposits.

The letter to customers goes on to say that First National’s holding company, First National Bank of Nebraska, is the largest privately owned banking company in the US and that the “private ownership structure is a significant competitive advantage”.  Since the bank’s not publicly traded, Johri and his management team can make decisions that aren’t determined by his investors on Wall Street.

Safe Place for Your Money

At one point, Johri mentions how the 150 year old bank has “witnessed and overcome numerous negative economic cycles” in the past.  Another assurance he offers customers is that First National Bank is a member of FDIC, so any money in the bank or in FNBO Direct is federally insured up to $100,000 per depositor.

It’s nice to see that there are some financial institutions that were responsible with their funds during a time when many banks were engaged in speculation with our money and ignored the risks of using leverage to become more profitable.  After learning more about First National Bank I feel confident that any funds I deposit in their online savings bank, FNBO Direct, will be safe and I’m going to open an account this week and move our emergency fund there.


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Ben Edwards, the founder of Money Smart Life, saved up enough to buy a Nintendo back when he was 12 years old. When he used the money to buy shares of Wal-Mart stock instead, he knew he wasn't like the other kids... His addiction to personal finance has paid off for his family and now he's helping you to afford the life that you want. Check him out on the web at Google Plus, Twitter and Facebook.

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9 Responses to FNBO Direct Online Savings Bank – Safe, Secure, & FDIC Insured

  • julie

    Do NOT get a credit card from FNBO- you will end up with an APR of 28.9% for being 1 day late with a payment. I repeat – DO NOT get a credit card thru FNBO. Citibank is much better.

  • Friend

    Get the online savings and billpay together if you need a checking account too, makes life a lot easier.

  • Aaron

    I’m from Omaha, and I can concur with your assessment: FNBO is probably one of the best-run banks in the country. And Warren Buffett banks there, which is all you need to know, really.


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