US bank deposits see largest drop in Q1 in almost 40 years
Reduction in estimated uninsured deposits, down $663.3 billion, or 8.3%, was primary driver of quarterly decline, says federal agency
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Total deposits at American banks fell $472.1 billion in the first quarter, marking the largest decline in almost 40 years, according to a report Wednesday by the Federal Deposit Insurance Corporation (FDIC).
The amount represents a 2.5% decline in total deposits, compared to the fourth quarter, and it is the biggest reduction since data collection began in 1984.
It also marked the fourth consecutive quarter that the banking industry reported lower levels of total deposits, said the FDIC.
A reduction in estimated uninsured deposits, which was down $663.3 billion, or 8.3%, was the primary driver of the quarterly decline, it added.
Estimated insured deposits, on the other hand, increased $255.1 billion, or 2.5%, in the first quarter.
The report comes as the recent banking crisis in the US saw the sudden collapse of three banks in the world's biggest economy --- Silicon Valley Bank and Signature Bank in March, followed by First Republic Bank on May 1.
The FDIC said the number of banks on its "Problem Bank List" -- including banks with financial, operational or managerial weaknesses -- increased by four from the previous quarter to 43 in the January-March period, while their total assets rose $10.5 billion to $58 billion.
The FDIC's report includes 4,672 commercial banks and savings institutions insured by the agency.
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