"Our funding model, our deposit model is really what is unique as the engine that drives that bank. And that is we are the depository for all state tax collections and fees. And so we have a captive deposit base, we pay a competitive rate to the state treasurer. And I would bet that that would be one of the most difficult things to wrestle away from the private sector—those opportunities to bid on public funds. But that’s only one portion of it. We take those funds and then, really what separates us is that we plow those deposits back into the state of North Dakota in the form of loans. We invest back into the state in economic development type of activities. We grow our state through that mechanism."
The significance of the North Dakota experiment is that the dominance and control of the State/Capital cabal can be broken. Sensible banking is based upon making loans for productive enterprises, not derivative speculation. The customer of any bank is a person. Financing business growth and development is the core purpose and function of a bank.
The populist underpinnings of the independent method of funding the Bank of North Dakota provide an alternative model for depository transactions. Prosperity for local economies is an integral objective for any community interest bank. Those who profess free market enterprise principles need to adopt practical partner relationships with proponents of state charted banks.
ABC News reports the inconceivable, State-Owned Banks: The Future of Banking?