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Bank deposit flight continues into August, and community banks cannot sustain paying more for deposits than big banks. This trend does not end well. Get ready for more pre-arranged bank mergers like PacWest as regulators want to side step the 485 bank failures saga from 2008-2011. Note the following from this article: "Deposits into smaller banks are rising simply because they are being forced to pay more for their customers. The regionals are winning the deposit battle right now because they’re willing to pay the most.” Yokum’s analysis is supported by JPMorgan’s impressive Q2 presentation, which recorded a 67% rise in quarterly profits to $14.47 billion in the quarter ended June 30th, despite the large drop in deposits." #cre #ccim #trepp #banks #redshoeeconomics #commercialrealestate #uli #sior #naiop https://lnkd.in/gQmw-ATx
How does JPMorgan's rise of 67% in profits on a smaller deposit base equal paying more.....sounds like they are getting away with more
Gene Fuss
1y
Thank you for sharing this.
Wow, good stuff here!
Paying these current deposit rates is not sustainable for these community banks long term, especially the ones that put a significant amount of fixed rate commercial real estate loans on the books the last several years.