North Dakota State Bank Thrives in Trump Stronghold, Becomes Model for Progressive Candidates
Created in 1919, the only public bank in the USA saved a coal plant, financed works and passed on profits to the State, according to a report by CNBC Television.
BY THE X-TRADER NEWS NEWSROOM · REPORTING FROM CNBC TELEVISION · 3 MIN
The Bank of North Dakota, the only state-owned bank operating in the United States, is thriving in a state where Donald Trump won by a double-digit margin in the last election and has come to be seen by progressive candidates as a model to copy. The information comes from a report by CNBC Television, conducted by Garrett Downs.
According to the report, the institution was decisive in preventing the closure of the Coal Creek Station plant, a large coal-fired thermoelectric plant that supplies around 1.7 million people in Minnesota. Five years ago, the operation was about to be closed, which would have put more than 600 jobs at risk. In 2022, Rainbow Energy Center purchased the plant with support from the bank.
How the operation worked
Bank of North Dakota purchased $150 million in bonds from a state infrastructure authority to facilitate the deal. According to the report, the package combined traditional credit, interest rate buy downs and some subsidies. Rainbow CEO Stacey Snider said funding would be difficult to obtain outside the state because of what he called a war on coal under previous administrations.
The plant sits on large reserves of lignite, a type of coal. The company plans to use the energy for a 430 MW data center project focused on artificial intelligence, in addition to activities linked to cryptocurrencies, according to the report.
Another example cited was the Theodore Roosevelt presidential library, in Medora, a US$450 million project. The bank granted a credit line of US$70 million at zero interest, which allowed the work to begin before receiving the donation promises.
A public bank with its own logic
The bank was created in 1919, at the height of a populist and socialist movement that took over the American Midwest. Wheat farmers, dissatisfied with freight rates and interest charged by large Minneapolis banks, founded the Nonpartisan League and the institution.
In the report, the bank records US$10.6 billion in assets, a small amount compared to giants such as JP Morgan and Bank of America. Residents open accounts with just US$50. The institution does not have federal deposit insurance (FDIC): deposits are fully guaranteed by the credibility and financial capacity of the State.
The state keeps its general fund resources at the bank itself and uses those deposits for disaster and student loans. Profits return to the state treasury, and the total passed on throughout history reaches almost US$1.9 billion. According to the report, this helps maintain solid finances and relatively low state taxes, in addition to supporting farmers in a period of low prices and tariffs.
Risks and political debate
Governance is shared between the governor, the Legislature and an industrial commission. One of the interviewees recognized that, when something belongs to the State, politics becomes part of the management, and attributed the longevity of 107 years to this framework, remembering that many other public banks have failed.
Massachusetts and Washington State are considering copying the model. One supporter of the idea argues that public money would be safer under democratic control than under private shareholders. A bank director, however, warned that the model first requires forming deposits and generating profit, and said that it would probably not be possible to create the institution today.
For the investor, the case is an indicator that the debate on state credit should gain ground in the 2026 campaign. The question remains, which the report does not resolve, of how a model born from specific historical conditions would work in other States.
Automatically translated from Portuguese.
