Bank Analysis School - September 2023

Internal Use Only

Falling Below Well Capitalized Impacts Liquidity

Deposit Rate caps (1) average national rate + 75bps, or (2) for maturity deposits 120% of current treasury yield on similar maturity, and non-maturity at Fed Funds rate + 75bps

Brokered deposits restricted  Banks may not accept or renew brokered deposits – no waivers.

(Part 337.6 & 337.7 FDIC Rules and Regulations)

Internal Use Only

“Reliance on non-core funding sources is a risky strategy. These funds may not be available in times of financial stress and can lead to liquidity shortfalls.”

Summary Analysis of Failed Banks Office of Inspector General, September 2011