Federal Reserve Report Examines Bank Deposit Runs
A new report from the Federal Reserve Bank of St. Louis calls recent runs on bank deposits historically "extraordinarily fast and large." It points to the connected, concentrated nature of the depositors at the failed banks as a defining factor in the speed and size of the deposit runs. "The depositors at Silvergate, Signature and SVB were heavily concentrated in specific industries and connected to each other. As a result, these depositors were much more likely to behave in coordinated or similar ways," the report states.
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Overdraft, NSF Revenues Decline
According to the Consumer Financial Protection Bureau (CFPB), overdraft and non-sufficient funds (NSF) fee revenue decreased by 48% between the fourth quarters of 2019 and 2022. The CFPB attributes this reduction to changes in bank policies related to overdraft and NSF fees. The CFPB also stated its intention to continue monitoring overdraft and NSF fees and is considering potential rulemaking activities related to these fees.
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