US Banks’ Domestic Deposits Tumble For Second Week In A Row

Money market funds saw a very small net outflow (-$2.2BN) last week, leaving them still just shy of the record high…

Source: Bloomberg

On the bank side of the savings world, total deposits (SA) rose $17.5BN to its highest since Sept 2022…

Source: Bloomberg

On a non-seasonally-adjusted basis, total deposits jumped a huge $148BN (reversing the prior week’s $133BN deposit decline)…

Source: Bloomberg

Rather oddly, excluding foreign deposits, domestic US banks saw a $22BN net deposit outflow last week on an SA basis during the week-ending 10/30 (but a $113BN inflow on an NSA basis)…

Source: Bloomberg

On an NSA basis, Large banks saw $86BN inflows and Small banks $27BN inflows. However, on an SA basis, large banks saw $21BN outflows and small banks $1.5BN outflows.

Interestingly, loan volumes shrank at small banks but surged for large banks…

Source: Bloomberg

Finally, bank deposits at the Fed rose last week (and so did US equity market capitalization to a new record high)…

Source: Bloomberg

Will this ever recouple?