A template for healthcare CFOs to document banking counterparty risk exposure, with FDIC coverage details and contingency planning.
Prior to March 2023, "what is our exposure if our primary bank fails?" was theoretical. Now it dominates every healthcare audit committee meeting. Your CFO needs documentation addressing this concern — and the format that works is a one-pager with five half-page sections.
Section One: Total Cash by Bank
List every bank holding balances, including current amounts and the entity owning them. Most platforms underestimate concentration risk through aggregate rather than counterparty thinking, which is easier to fix once each PC and MSO banks on one entity-aware platform (opens in a new tab).
Section Two: FDIC Coverage Status
For each entity at each bank, document the insured amount, using the same math as calculating your practice's FDIC coverage gap (opens in a new tab) (typically $250K base, up to $10M with IntraFi sweep), uninsured portion, and action items if uninsured balances exceed policy limits.
Section Three: Counterparty Diligence
For each bank, note partner bank status (FDIC-insured, IntraFi member, Federal Reserve member), capital ratios from recent regulatory filings, and concerning developments, the same diligence covered in what to ask before signing with a new banking partner (opens in a new tab).
Section Four: Contingency Plan
If the primary bank fails Friday evening, what occurs Monday morning regarding payroll? Which accounts have backup signers elsewhere? How quickly can balances transfer?
Section Five: Review and Approval
Document last review date, next scheduled review, and audit committee approval signature.
Three indicators the one-pager succeeds:
Your PE sponsor will likely request this one-pager in quarterly board materials. If not yet mentioned, anticipate the ask. Develop it proactively rather than reactively.