Wealthy Clients Trigger Massive Banking Exodus
Recent data regarding the global banking industry has unveiled significant withdrawals from depositor accounts in the past year.
In the latest findings from the Federal Reserve of St. Louis, American banks have encountered a total of $605 billion in depositor withdrawals within a year.
Meanwhile, a compilation of S&P Global Market Intelligence data indicates that total deposits in banks across France, Germany, Spain, and Italy, as well as in the Benelux and Nordic regions, saw a reduction of approximately $950 billion over 12 months. This cumulative figure across the mentioned countries amounts to a substantial $1.55 trillion in withdrawals.
Interestingly, as customers opt to transfer their funds elsewhere in pursuit of more lucrative returns, it is noteworthy that affluent clients are currently having the most significant impact on the financial performance of major U.S. banking institutions, as indicated by Yahoo Finance.
During the second quarter of this year, JPMorgan Chase, Wells Fargo, Bank of America, and Citi all reported decreases in deposits within their wealth management divisions.
Furthermore, data from Curinos reveals that wealth management and corporate accounts have witnessed a 13% decrease in deposits from the beginning of the year through July.
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In response to these developments, all four banks introduced new incentives for certificate of deposit (CD) savings accounts this summer, aiming to maintain competitiveness with money-market accounts that have attracted hundreds of billions of dollars in deposits over the past year.
These strategic efforts may already be showing signs of progress. According to Curinos, the flight of institutional deposits from major U.S. banks appeared to stabilize in July, although data for August remains pending release.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
