Banks do not issue funds. The funds they sell are all issued by fund companies, and banks play the role of underwriting/consignment. If we only buy funds on the platform of the bank, even if the bank goes bankrupt, the funds we buy can still be redeemed directly from the fund company through relevant vouchers. As long as the fund company has not closed down, then our money is safe. Although this fund is not protected by the Deposit Insurance Ordinance, other risks are not so high except investment risks. Investors and managers are not the only ones who buy funds. In fact, there is a third custodian. Generally, the custodian is a bank. So what if the custodian bank goes bankrupt?

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If the entrusting bank goes bankrupt, then the fund funds should actually be analyzed in two categories.

The first category is the funds that have been invested, such as buying stocks or bonds, which are completely unaffected by bank failures; The second category is the funds that have not been invested and are still in the bank. Because considering the redemption of investors, in fact, many funds are not fully invested, but there are still a small amount of funds to deal with the redemption that investors may initiate at any time. Then if the bank goes bankrupt, this part of the funds will definitely be affected, but as long as the fund company does not go bankrupt, then our funds are still safe. When we invest in the fund, although the fund may be purchased through the bank channel, the bank only plays the role of consignment. Even if the bank goes bankrupt, the fund we bought will not be affected in any way. At most, contact the fund company at the time of redemption, instead of redeeming directly through the banking platform.

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If the bank hosting fund funds goes bankrupt, the impact on our fund will not be great, because most of the funds have been invested and will not be affected, and a small part of the funds that have not been invested will be borne by the fund company. To sum up: bank failure will not affect the funds we invest, so don't worry too much about the risks in this area. Banks are really not that easy to fail.

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