A large percentage of it is entirely their money. And in fact, not even actual money somebody at the bank owns, just numbers on their ledger (that they still make interest from borrowers off).

In fact, there's most of the money the banks loan is not "somebody else's" at all, it's "loan money".

https://opentextbc.ca/principlesofeconomics/chapter/27-4-how...

Or even money at all.

Banks are not like a giant piggy bank with your savings in it. They create money when they create loans. They're not protecting "your money" with things like this, they are protecting their profits.