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Tuesday, October 20, 2015

Big Banks to America's Firms: We Don't Want Your Cash

http://www.wsj.com/articles/big-banks-to-americas-companies-we-dont-want-your-cash-1445161083


The latest fees center on large sums deemed risky by regulators, sometimes dubbed hot-money deposits thought likely to flee during times of crises. Finalized last September and overseen by the Federal Reserve and other regulators, the rule involving the liquidity coverage ratio forces banks to hold high-quality liquid assets, such as central bank reserves and government debt, to cover projected deposit losses over 30 days. Banks must hold reserves of as much as 40% against certain corporate deposits and as much as 100% against some deposits from hedge funds.
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Few banks disclose how much in "nonoperating" deposits they hold. Credit Suisse Group AG analysts estimated in August that the top four U.S. banks by assets hold roughly $650 billion in those deposits that require the highest levels of reserves.

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