Driving Community Prosperity with Reciprocal Deposits By Joe Hooker, Chief Sales Officer IntraFi, ICBC Associate Member Community banks, which make up at least 90% of all banks nationwide, are the backbone of American small businesses.1 An ICBA report found that roughly 60% of small business loans and over 80% of agricultural loans come from community banks.2 But community banks face steep challenges, including net interest margin compression, compliance and cybersecurity burdens, and new, often digital-only, competitors. In fact, 97% of respondents to IntraFi’s Q1 2026 survey of bank executives say they expect deposit competition to remain at current levels or increase over the next year. To stay competitive and continue providing the vital banking services their communities depend on, community banks need every advantage available to attract and retain high-value relationships. Reciprocal deposits are an essential tool that allows community banks to support local deposit and lending needs, enabling banks to offer large depositors access to millions in FDIC insurance while keeping funds local to lend in the community. RECIPROCAL DEPOSITS TYPICALLY HAVE A HIGH REINVESTMENT RATE Reciprocal deposits are deposits that a bank receives through a deposit placement network in return for placing a matching amount of deposits at other network banks. Importantly, the institution placing the deposit maintains its relationship with the depositor — granting safety-conscious customers the ability to obtain FDIC insurance on large balances through multiple network banks while maintaining a single bank relationship. 22 | INDEPENDENT REPORT
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