Question 1

What is FDS Bank?

Accepted Answer

FDS Bank is a specialized federal savings bank headquartered in Mason, Ohio, a suburb of Cincinnati. With approximately $70 million in total assets, FDS Bank operates as a limited-purpose financial institution that focuses exclusively on supporting the credit card operations of its parent company, Macy's, Inc.

The bank's primary business is the origination and servicing of private label credit cards for Macy's and Bloomingdale's department stores, along with issuing prepaid accounts for employees. Unlike traditional retail banks, FDS Bank operates without branch offices and maintains assets primarily in federal funds sold and investment-grade securities.

Question 2

When was FDS Bank founded?

Accepted Answer

FDS Bank was established by Federated Department Stores (now Macy's, Inc.) to support its retail credit card operations. The bank received its federal charter (Charter Number 716138) and has been operating as a federally-chartered savings association since its inception.

In February 1996, FDS Bank received its designation as a limited purpose institution for Community Reinvestment Act (CRA) purposes. In November 2020, the bank transitioned from operating as a Qualified Thrift Lender to a Covered Savings Association, which allows it to operate with the same rights and privileges as a national bank while maintaining its federal savings bank charter.

Question 3

Where is FDS Bank headquartered?

Accepted Answer

FDS Bank is headquartered at 9111 Duke Boulevard in Mason, Ohio. Mason is located in Warren County and is part of the greater Cincinnati metropolitan area.

The bank's headquarters is located in the same facility as Macy's Credit and Customer Services, Inc. (MCCS), which handles the credit card servicing operations for the Macy's retail enterprise.

Question 4

Where does FDS Bank operate?

Accepted Answer

FDS Bank operates throughout the Cincinnati-Middletown, OH-KY-IN Metropolitan Statistical Area (MSA), with its assessment area encompassing portions of three states. The bank's operational footprint includes multiple counties across Ohio, Kentucky, and Indiana.

In Ohio, the assessment area includes Warren County, Butler County, Hamilton County, Clermont County, Brown County, and Clinton County. In Kentucky, it covers Boone County, Campbell County, Kenton County, Gallatin County, Grant County, and Pendleton County. In Indiana, the area extends to Dearborn County, Franklin County, Union County, and Ohio County.

Despite this broad operational area, FDS Bank maintains only one physical office location and does not operate traditional branch banking facilities.

Question 5

What services does FDS Bank offer?

Accepted Answer

FDS Bank offers a highly specialized suite of financial services focused primarily on retail credit card operations:

Private Label Credit Cards: The bank originates private label Macy's and Bloomingdale's credit cards for commercial entities and employees of Macy's retail stores. These cards are used exclusively at Macy's and Bloomingdale's locations.

Prepaid Account Services: FDS Bank issues prepaid accounts specifically for Macy's employees, providing convenient access to wages and other compensation.

Credit Card Servicing: Working in partnership with Department Stores National Bank (a Citigroup subsidiary), FDS Bank services over 20 million active consumer credit card accounts annually. Most receivables originated by FDS Bank are subsequently sold and serviced on a pass-through basis.

The bank does not offer traditional retail banking services such as checking accounts, savings accounts, mortgages, or personal loans to the general public.

Question 6

What makes FDS Bank unique?

Accepted Answer

FDS Bank stands out as one of the few remaining retailer-owned banks in the United States, representing a specialized business model that serves a single corporate parent. Several distinctive features set it apart:

Captive Bank Structure: As a wholly-owned subsidiary of Macy's, Inc. (through FDS Thrift Holding Company, Inc.), the bank operates exclusively to support its parent company's retail credit operations rather than serving the general public.

Asset Composition: Unlike traditional banks focused on loan portfolios, FDS Bank's assets are concentrated in federal funds sold and investment-grade securities, making it one of the most liquid and well-capitalized financial institutions in its size category. As of recent regulatory reports, the bank maintained a Tier 1 leverage capital ratio exceeding 24%, far above regulatory minimums.

Community Development Focus: Despite its specialized business model, FDS Bank actively participates in community development activities. The bank has provided significant qualified grants to organizations like People Working Cooperatively (PWC) for affordable housing initiatives and financial literacy programs serving low- and moderate-income individuals in the Cincinnati area.

No Physical Branch Network: Operating entirely from its Mason, Ohio headquarters without any branch offices, the bank represents an efficient, technology-enabled model for specialized financial services.

Partnership with Citigroup: FDS Bank works collaboratively with Department Stores National Bank under a long-term credit card program agreement that leverages the strengths of both institutions.

Question 7

What type of financial institution is FDS Bank?

Accepted Answer

FDS Bank is classified as a Federal Savings Bank and operates as a Covered Savings Association under federal banking regulations. This designation was adopted in November 2020, allowing the bank to exercise the same rights and privileges as a national bank while maintaining its savings association charter.

The bank is also designated as a Limited Purpose Institution under the Community Reinvestment Act (CRA), reflecting its specialized business model focused on credit card operations rather than traditional community banking services. This classification is appropriate given the bank's narrow product line and its role as a captive financial institution supporting Macy's retail operations.

FDS Bank is regulated by the Office of the Comptroller of the Currency (OCC) and is a member of the Federal Deposit Insurance Corporation (FDIC), providing deposit insurance protection under FDIC Certificate Number 33831.

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