Heterogeneity Across Uninsured Deposit Growth

• Abstract: The uninsured deposits were one of the most concerning vulnerabilities during the banking turmoil of early 2023. This paper investigates the surge in uninsured deposits among U.S. banks in the past decade, focusing on those with assets ranging from $50 billion to $700 billion. I show that current domestic uninsured deposit levels are historically high, with significant heterogeneity across banks. My analysis suggests that the deregulation of the liquidity coverage ratio (LCR) from 2018 to 2019 has had an impact on the dynamics of uninsured deposits. Employing a regression discontinuity design (RDD) around the regulatory cut-off for asset size, I highlight the consequential shifts in liquidity funding amongst the deregulated banks.
• Presentations: Inter-Finance PhD Seminar (2023), Kellogg Finance Department (2023)