you as a dollar holder are not obligated to give him your dollar for him to pay it back to the bank
you as a dollar holder are not contracted with him to request dollar from him to settle the banks debt
you as a dollar holder are not secured to receive a dollar from him when he pays the bank
if he fails to pay and the bank gets in trouble. your not guaranteed a $10 cheque from the government insurance

the bank does not use your dollar to pay him in a loan. thus he does not owe you.
banks CREATE new money for loans, not swap old money around

he can pay the bank via many means. but that contract is between him and the bank. not you
he can go abroad. and work on an african gold mine. and get paid euros. and a euro bank can convert that to dollars to pay his loan..
meaning never interacting with you, meaning he does not need to touch a dollar to repay

he can become a bitcoin miner, mine some rewards and go to an exchange and then pay off the bank loan.. again nothing do to with you
he can get a job or manufacture something, charge payment in many forms or such. again nothing to do with you.

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maybe big numbers are too big to imagine.. lets simplify it

if you have $10 bank note. there is no insurance. if you lose it or have it stolen banks wont reimburse you. its your loss

if you deposit it. the bank keeps $1 bank note in a vault. puts $10 into a digital balance,.
and separately due to a contract THE BANK has with government and other private banks. the bank can also create another balance account for someone else for another $9 (meaning upto $30 in circulation in different forms)
.. this loan creation charter is not a contract between you and the bank. nor you and the government nor you and the borrower

your bank note has no contract where by you are part of the $10 deposit balance + $1 bank note vault part
your bank note has no contract where by you are part of the $10 deposit balance + $1 bank note + $9 loan account part

your bank agreement is that you put in 10, you can get out 10
crumpled note 10:10 crisp note.. that is all (and in many cases they can charge you for that service)
...
lets say from this separate $9 allotment 2 people (a, b) takes a loan for $5 and $4 respectively.
a. interest is 5% meaning after a year he pays THE BANK  $5.25
b. interest is 5% meaning after a year he pays THE BANK  $4.20

the bank cancels out the $5 and $4(that was in circulation) so that it can reuse it as $9 for new loans
and the bank keeps the $0.45
with this though.
the bank owes another private bank insurer an insurance premium on the $9 allotment(separate from deposits) its allowed to play with
the bank has also obligations with the FDIC to pay an insurance premium on deposits
the bank also wants to pay you something for not withdrawing your deposit.
but these 3 things are not contracts with you.

these three things do not bind you to the loan account via the 3 contract path.
they are separate contracts for separate services the bank has with separate entities
banks are not obligated to pay you interest. they can change the terms of accounts conditions as they please
its why banks used to be generous with a 5% incentive a couple decades ago but now only pay silly 0.05%
you have no security/guarantee of getting interest. because the agreement allows them to change the terms
..
to incentivise you to not withdraw your 10 the bank will put limits on daily spending. charge you if you spend too much, too often,  and also offer a bit of a bonus if you keep it in for a year(if they chose to)

this is not security to you. this is just a way that if they can keep your money. it allows them to profit with the new balance in the other account they created(out of nothing)

if the bank was to fail. the government wont send you a cheque instantly for $10 or send 4 loaves of bread(value rate at deposit)
what they do instead is shift the failed banks accounts to other banks. so you simple get Bank A 10:10 bank B

whereby the cost of the swap ends up that your buying power diminishes from 4 loaves of bread to less loaves of bread.

the 2008 banking crises shown millions of people lost out directly and all americans value diminished due to the inflation caused by the bailout

if $10 could buy you 5 loaves of bread in 2008.. i can guarantee you now. withdrawing $10 now wont get you 5 loaves now. and i guarantee you you wont get 4 loaves in the near future. and also.. if your bank fails. the chances of you filing a claim to get a FDIC cheque is super small. they would prefer to get the country to pay more tax and just shift balance sheets around to other banks. than pay out the insurance

so dont think that you will get a guaranteed cheque from the FDIC if your bank fails.
and dont think you can still buy 4 loaves(todays value) with your future $10 in a different bank account that took over yours