Banks See $1,555,000,000,000 in Deposit Flight

Banks see great losses recently, and we’ll be addressing the issue below. Check out more reports about the matter.

Recent data reveals the extent to which depositors have withdrawn their funds from banks around the world over the past year. The Federal Reserve of St Louis reports that US banks have experienced a $605 billion reduction in deposits.

Additionally, S&P Global Market Intelligence has compiled data that shows total deposits in France, Germany, Spain, Italy, Benelux, and Nordic regions decreased by approximately $950 billion over the course of 12 months.

As a result, the combined total of deposit flight across these countries amounts to $1.55 trillion.

According to a recent report from Yahoo Finance, wealthy customers are causing the biggest damage to the profits of America’s major banks as they seek higher returns and withdraw their money.

JPMorgan Chase, Wells Fargo, Bank of America and Citi all reported a decrease in deposits in their wealth management divisions during the second quarter of this year.

The data from Curinos also shows that there was a 13% decline in deposits from wealth management and corporate accounts from the beginning of the year until July. In response, these banks launched new offers for certificate of deposit (CD) savings accounts this summer to compete with money-market accounts, which have seen billions of dollars of inflows over the past year.

These efforts seem to be paying off as the institutional deposit flight from big US banks paused in July, and the data from August has yet to be released.

A couple of days ago, we revealed the fact that according to Bloomberg Intelligence senior macro strategist Mike McGlone, recent Bitcoin price movements suggest that economic turbulence may be on the horizon.

In a post on social media platform X, McGlone pointed out that Bitcoin is displaying bearish divergence when compared to the Nasdaq 100 Stock Index, which could be a sign of an upcoming recession.

He also noted that Bitcoin has dropped by around 15% in the third quarter of 2021, while the Nasdaq 100 Stock Index has gained 2%.