Blog

For a school district business manager or a city treasurer in North Dallas, the weight of responsibility is heavy. You aren't just managing "money"; you’re managing the public’s trust—the funds that pay for new textbooks, local police patrols, and the maintenance of our roads. But when those deposits grow beyond the standard $250,000 FDIC insurance limit, the rules of the game change.

Traditionally, protecting those extra funds in Texas meant a tedious process of "collateralization." To stay compliant, banks have to set aside specific government bonds as a backstop. For the public official, this means tracking market values, managing pledge agreements, and staying on top of constant paperwork.

First Lonestar Bank (myfirstlonestar.com) is helping municipalities and schools cut through that red tape throughout North Dallas, including Frisco, McKinney, Prosper and other cities in the area with a more straightforward approach: IntraFi Cash Service (ICS) and CDARS.

How It Works (Without the Jargon)

Think of these services as a high-tech "sorting hat" for your deposits. Instead of you having to manually open accounts at dozens of different banks to keep your funds insured, First Lonestar Bank does the heavy lifting for you.

When a school district or city places a large deposit with us, we use the IntraFi network to break that total into smaller pieces, each under $250,000. These pieces are placed with other well-capitalized banks across the country. Because every piece is under the limit, the entire balance is covered by FDIC insurance.

The best part? You never have to deal with those other banks. You still have one point of contact at First Lonestar, one statement, and one login.

Why North Texas Public Entities Are Making the Switch

The "why" comes down to three practical benefits: simplicity, safety, and community impact.

• Ending the Paperwork Chase: In Texas, if a deposit is fully insured, the legal requirement to pledge collateral is satisfied without the need for manual bond tracking. For a city treasurer, this means no more checking quarterly bond prices or managing third-party safekeeping accounts.
• Keeping the Focus Local: You might worry that "sending" money to other banks means those funds leave our community. In reality, these are "reciprocal" deposits. For every dollar First Lonestar sends out to protect it, an equal dollar comes back into our bank from another institution in the network. This allows us to keep the full value of those public funds on our own books to fund local loans right here in Frisco and Dallas.
• Total Peace of Mind: The market value of collateral can fluctuate based on interest rates. FDIC insurance does not. It is the "gold standard" of protection. By ensuring every cent of a school district’s budget is backed by the full faith and credit of the U.S. government, officials can sleep better knowing the funds for next year's payroll are secure.

Frequently Asked Questions

Who do I call if I need to move funds?

Just us. First Lonestar Bank remains your single point of contact. You won't have to manage relationships with other banks in the network.

How fast can we access our cash?

If we use the IntraFi Cash Service (ICS), you have "demand" access for your immediate cash needs. For funds you don't need right away, CDARS allows you to lock in a rate for a fixed term.

Does this cost more than traditional collateral?

There are no hidden "per-bank" fees. While rates are competitive, the real value for most Texas treasurers is the massive reduction in administrative work and the increased security of FDIC insurance.

Ultimately, managing public funds shouldn't be a trade-off between security and simplicity. By moving away from the manual hurdles of traditional collateral, Texas’s public stewards can ensure their deposits are fully insured, compliant, and kept right here at home to support our local economy.

Ready to simplify your treasury management?

Contact First Lonestar Bank to get started! Call an FLB Associate at 489.369.3880 or visit our Frisco, Texas, branch today!