April 2024: Deposits and the March 2023 Banking Crisis – A Retrospective

New York FED Liberty Street Economics – Blog Entry
by Stephan Luck and Matthew Plosser

The authors evaluate how deposits have evolved over the latter portion of the current monetary policy tightening cycle. They find that while deposit betas have continued to rise, they did not accelerate following the bank runs in March 2023. In addition, while overall deposit funding has remained stable, the authors find that the banks most affected by the March 2023 events are offering higher deposit rates and are growing their deposit funding relative to the broader banking industry.

Links:
New York FED Liberty Street Economics – Deposits and the March 2023 Banking Crisis – A Retrospective