Under Dodd-Frank if a bank becomes insolvent they can take the money deposited in bank accounts at the bank and use it to cover their losses. Think Italy and Cyprus. If this is done there is the $250,000 guarantee by the FDIC, but the bank under the law doesn’t owe the money confiscated. They give the account holders equity stock in their insolvent company.
I totally thinking about cashing out my savings account.
Just to be clear, even before Dodd/Frank, interest bearing bank deposits were structured as debts on the balance sheets and a depositor is an unsecured lender.