Open Daily: 10am - 10pm | Alley door pickup 10am - 7pm 3038 Hennepin Ave Minneapolis, MN
612-822-4611

  • Open Daily: 10am - 10pm
    Alley-side Pickup: 10am - 7pm

    3038 Hennepin Ave Minneapolis, MN
    612-822-4611

Open Daily: 10am - 10pm | Alley-side Pickup: 10am - 7pm
3038 Hennepin Ave Minneapolis, MN
612-822-4611
Deposit Rate Advantages at the Largest Banks

Deposit Rate Advantages at the Largest Banks

Federal Deposit Insurance Corporation

Paperback

Accounting

ISBN10: 1507563051
ISBN13: 9781507563052
Publisher: Createspace
Published: Jan 14 2015
Pages: 44
Weight: 0.28
Height: 0.09 Width: 8.50 Depth: 11.02
Language: English
We estimate differences in funding costs between the largest banks and the rest of the industry. Using deposit rates offered at the branch level, we eliminate many non-risk-related differences between banks. We document significant and persistent pricing advantages at the largest banks for comparable deposit products and deposit risk premiums. Between 2007 and 2008, the risk premium paid by the largest banks was 39 bps lower than the risk premium at other banks under the baseline estimate after controlling for common risk variables. These findings are consistent with an economically signiïfcant too-big-to-fail subsidy paid to the largest banks through lower risk premiums on uninsured deposits.

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