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It’s been a year since the Federal Deposit Insurance Corporation (FDIC) conditionally approved a de novo charter for Primary Bank. Based in Bedford, NewHampshire, the new Primary Bank raised an astounding $29 million after obtaining approval for its charter on March 17th of 2015.
The concept was new, and growth was projected to be robust, albeit not off the charts. The FDIC required the bank to raise $20 million in capital, a tidy sum back in the 1990’s when banks got started with less than half as much. Yet they are also requiring high levels of capital. But that capital comes from somewhere.
Capital Gain Capital gain is the profit you make when you sell an investment for more than you paid for it. If you buy a bike for $100 and sell it for $150, your capital gain is $50. It’s like a grand opening sale for a new store. It’s when stock prices are going up, and people are optimistic.
Traditional CDs are insured by the FDIC for up to $250,000 per account, making CDs a very low-risk investment. With CD laddering, you can create a flexible investment strategy that allows you to take advantage of the interest rates of long-term CDs, while also gaining access to your capital on a regular basis. Predictability.
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