US bank deposits, loans ticked down in latest week, Fed data show

In the second week of April, deposits at all U.S. commercial banks declined, but smaller banks held steady, indicating stabilization in the financial institutions hardest hit by deposit outflows after last month’s bankruptcy of two large regional banks.

In the week ending April 12, non-seasonally adjusted deposits at all commercial banks declined to $17.38 trillion from $17.43 trillion, according to Federal Reserve data released Friday.

The top 25 banks dropped virtually entirely, the data found.

The Fed’s Friday report didn’t reveal that banks’ loan capacity decreased due to deposit declines.

All bank loans and leases fell to $12.05 trillion from $12.06 trillion a week earlier.

After the most aggressive rate hikes in 40 years since March, Fed policymakers are closely monitoring bank lending and credit to determine how much more to boost rates. After authorities dissolved Silicon Valley Bank and Signature Bank last month, several officials fretted that sharply tighter credit would slow the economy and inflation, leaving the Fed with less to do.

Large time deposits, at $1.87 trillion nonseasonally adjusted, are at their highest since November 2009. However, they remain low at 10.8% of deposits, the greatest since August 2020 and up more than 3 percentage points from their record low in January 2022.

In May 2008, they had 31% of the market.