Recent trends For all banks (compared with 1992): Fewer total deposits,transaction accounts,and core retail deposits More time deposits (CDs)and equity. ▣Large banks: Fewer transactions accounts,large time deposits and equity More MMDAs,foreign deposits,and other borrowings 爸封强的黄香+孝
Recent trends Recent trends For all banks (compared with 1992): Fewer total deposits, transaction accounts, and core retail deposits More time deposits (CDs) and equity. Large banks: Fewer transactions accounts, large time deposits and equity More MMDAs, foreign deposits, and other borrowings
Core deposits They are stable deposits that customers are less likely to move when interest rates on competing investments rise. Not rate sensitive as large-denomination purchased (volatile)liabilities. Influenced more by location,availability, price of services. For large banks,core deposits/total assets:516)426(from1992to2001) 料酥价贸易大孝
Core deposits Core deposits They are stable deposits that customers are less likely to move when interest rates on competing investments rise. Not rate sensitive as large-denomination purchased (volatile) liabilities. Influenced more by location, availability, price of services. For large banks, core deposits/total assets: 51% Î42% (from 1992 to 2001)
Volatile liabilities Purchased funds from rate-sensitive investors They will move their funds If other institutions pay higher rates If it is rumored that the bank has financial difficulties With more such liabilities (34%v.s.15%), larger banks are paying market rates on a greater proportion,with less customer loyalty and thus greater liquidity risk. 猫行贺影小号
Volatile liabilities Volatile liabilities Purchased funds from rate-sensitive investors They will move their funds If other institutions pay higher rates If it is rumored that the bank has financial difficulties With more such liabilities (34% v.s. 15%), larger banks are paying market rates on a greater proportion, with less customer loyalty and thus greater liquidity risk