In my awesome investing luck, I purchased a brokered CD from First Republic Bank of San Francisco(should have been a warning sign) through E-Trade. While my CD is well under the $250K limit, I was wondering what would happen to the interest I'm owed if/when the FDIC returns my money? I'm guessing I get screwed out of any accrued interest?

Here is the answer if anyone is interested.

Most investors who held First Republic brokered deposits should also be made whole, although it’s not quite as straightforward as described in the sixth FDIC FAQ:

All brokered deposits, excluding the Cede & Co deposits, have been assumed by JPMorgan Chase Bank, N.A. If you are a customer who has a First Republic Bank deposit through a broker, you must contact your broker with any questions.

This appears to contradict the first FAQ in which the FDIC states that “all deposits” were transferred to Chase. According to this sixth FAQ, First Republic brokered deposits through Cede & Co were not assumed by Chase.

This FAQ also highlights an important issue regarding brokered deposits. Much of the accounting and payment responsibility falls on your broker. As the FAQ states, “If you are a customer who has a First Republic Bank deposit through a broker, you must contact your broker with any questions.”

It is my understanding that, yes, you will be made whole including the interest.

I had a brokered cd with Western Alliance Bank, another one of the regional banks that has been in trouble. I was nervous about it for a few days. Fortunately, it has matured. I then decided to stay away from cd's and roll the funds into T-bills instead. This batch mature in July. Now I have to keep an eye out for the X date and what would happen if Uncle Sam should default. Crazy times!