- The nation's lenders have been famously stingy in raising deposit rates alongside the Fed's series of short-term rate hikes. That's beginning to change, at least for their wealth management customers, write Telis Demos and Christina Rexrod in the WSJ.
- Wealthier customers “are very aware of where rates are moving to,” says Fifth Third (NASDAQ:FITB) CEO Greg Carmichael. “They’re shopping and want to make sure they’re getting the best returns on their deposits.”
- Indeed. Wealth management deposits fell at the big banks for the first time in years in Q3, including an average 4% decline at BofA (NYSE:BAC), JPMorgan (NYSE:JPM), and Wells Fargo (NYSE:WFC). This came even as deposits overall rose 5%.
- Banks are naturally responding, including at Bank of America, where the average rate on interest-bearing deposits more than doubled in Q2 to 0.24%. "They got a little behind the curve, and they had to move in a single quarter,” says CEO Brian Moynihan.
- "This is new for us," says Morgan Stanley (NYSE:MS) CFO Jonathan Pruzan, which this quarter boosted what it was paying on some deposit accounts from invisible to barely visible.
- Now read: Third Quarter Earnings At Morgan Stanley, Still A Go Relative To Goldman Sachs (NYSE:GS)
Original article