Is There A Trend Or Blip In The Fed And Fdic Data On Declining Bank Deposits?

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The commercial banks, which are the foundational institutions of finance, are at least somewhat unstable as a result of customer withdrawals from their accounts. To keep customers and financial support, company practices may also need to be adjusted.

The Federal Deposit Insurance Corp. (FDIC) reported late this month that, compared to the year’s end, bank deposit bases fell by $472 billion in the first quarter of 2023. That reflects a 2.5% total decline in bank deposits. It’s also the biggest decline ever noted in the FDIC’s almost 40 years of data collecting.

The FDIC reports that while the rate of loans and leases that are 30 to 89 days past due decreased from the previous quarter, it increased from the same quarter a year earlier by 4 basis points.

The St. Louis Fed reported on Friday, June 2, that the total amount of bank deposits had declined by roughly $13 billion in April, which is even further back than the FDIC numbers. The Fed also provides a little more detailed analysis of bank assets and liabilities on a week-by-week basis.