The stock of US bank deposits fell last year for the first time since 1948, as consumers withdrew about $278 billion from banks. In order to curb the outflow, financial institutions have begun to raise interest rates on deposits, especially for time deposits. Many large US banks, such as Capital One or Wells Fargo & Co, offer 4-5% interest to depositors.
However, there are also banks that do not compete for inflows. The largest financial institutions still have very high deposits, which may be why the average interest rate on fixed deposits is around 1.5%. On the other hand, according to many experts, small banks are struggling to survive, as lending is expected to slow down in the coming years, which will be very expensive for them without deposits.
Fixed deposits are the most popular because they offer the highest interest rates. The effect of the increase in stocks was also felt: in the fourth quarter, the stock of time deposits in the US banking sector rose from $ 1,490 billion to $ 1,700 billion, the largest jump in the past 20 years.
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