European Bank Failure & Conflicts in Law in US Branches

QUESTION: Hi Marty –
Thank you for the insight you provide as regards how the world really works. Spending 10 minutes reading your daily blog is equivalent to hours of reading the MSM propaganda and trying to discern the truth.
My question to you is in response to your 10/2/19 post >> Liquidity Crisis & the Pending European Banking Crisis. My mortgage is held by Santander bank, which I believe is headquartered in Spain despite being incorporated in Delaware. What can happen to my mortgage when the crisis is fully apparent to the world? I have minimal money in a savings account at Santander to meet their deposit requirements for a lower interest rate.
Would you re-finance to another US bank or credit union? Would you cash out some retirement savings to pay it off? I have a fair amount of money in retirement, but removing money with taxes and penalties would hurt and it would definitely put a dent in savings, which by the way is all held in mutual funds in US stocks only.
Thank you for your attention.
– STM

ANSWER: If you have a mortgage, as long as you are current, a bank failure will not impact your mortgage in the United States. Typically, assets of that nature are sold off to other banks. However, even a European bank operating in the USA is actually a different entity from Europe. They are under the regulation of the Federal Reserve and must be a member of FDIC.

Even if the parent went down in Europe, the US division would be subject to US rules and there would be considerable conflicts in law that would emerge. The US division would most likely have to be sold to another bank and the Fed may not allow a bail-in on US soil. The more likely scenario would be a shotgun wedding.