Public banks in California will be required to obtain Federal Deposit Insurance Corporation (FDIC) insurance and will be subject to the same regulations and protections as private banks. Deposits in public banks will be collateralized according to the same rules that apply to all banks. This ensures that public banks in California operate in a safe and responsible manner, protecting depositors and the public’s funds. The California Public Banking Act (AB 857) allows cities and counties to establish their own banks and requires compliance with these regulations as a condition of charter approval.