Over the course of a difficult month, New York Community Bank saw a 7% decline in deposits as clients withdrew their funds from the local commercial bank.

NYCB's Financial Stability and Implications for Consumers

Former Federal Deposit Insurance Corporation head Sheila Bair claims that the NYCB is no longer on the "watch list" for another possible bank failure with a fresh capital infusion of nearly $1 billion.

Bair, the author of the children's book series "Money Tales" and a member of the CNBC Global Financial Wellness Council, stated that consumers shouldn't be concerned about this.

The standard coverage of FDIC deposit insurance is $250,000 for each depositor, per bank, and per ownership type. However, Bair pointed out that other account formats, such as joint and trust accounts, might result in larger coverage levels.

The problems facing NYCB coincide with the one-year anniversary of the failures of Silicon Valley Bank, Signature Bank, and First Republic in May.

In an editorial that she co-wrote with Charles Goodhart, an emeritus professor at the London School of Economics, in The Washington Post recently, Bair cautioned that more bank failures are probably imminent due to recession risks, hazy interest rate projections, and instability in the commercial real estate sector.

Read also:Is Another Banking Crisis Brewing? NYCB Struggles Raise Unnerving Questions

Enhancing Oversight and Accountability Amid Banking Challenges

Mismanagement at banks has been a major factor in recent bank collapses. However, they argued, legislation to make such officials more accountable has stagnated on Capitol Hill.

According to Dennis Kelleher, president and CEO of Better Markets, a non-profit focused on creating a more secure financial system, consumers can feel secure in the knowledge that banking regulators have been working extra hard since last year to review the banks and make sure they are closely monitored, especially if they have concentrations of risky loans or other types of activities that may cause stress.

Customers should confirm that their balances are less than the uninsured deposit caps, according to Bair. To assist with that, the FDIC offers a tool for consumers to assess their coverage on its website.

According to Bair, customers who have deposits below the insured deposit limits should normally be able to keep access to them in the event of a collapse.

Depositors can monitor banks using a variety of resources, such as call reports that are filed with the FDIC and financial statements.

However, she noted that certain institutions are weak, which is why it's critical to strengthen risk management incentives.

Kelleher says small firms should be especially careful since they need to safeguard their cash flow and capacity to operate.

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